Published by the government of Zimbabwe
Walter Muchinguri
2 July 2009
Harare — GOVERNMENT has secured a US$60 million loan from a Tunisia-based African Export-Import Bank to boost tobacco production, Finance Minister Tendai Biti has said.
Tobacco is emerging as one of Zimbabwe's best cash cows and the US$60 million is half of the industry's annual requirements.
Minister Biti said his office was working on the modalities of releasing the funds, which would be disbursed through a consortium of local banks.
He was speaking during the 49th congress of the Zimbabwe Tobacco Association on Tuesday.
Minister Biti, however said he was aware that the loan secured was short of the industry's requirements.
"I have been told by the ZTA president Mr Andrew Pereira that the industry requires US$120 million to increase production from the current 42 million kg to around 75 million kg," he said.
The securing of finance for the industry is part of the mandate that Government apportioned itself under the Short Term Emergency Recovery Programme as it tries to wean off farmers who have in the past depended on input handouts.
Under STERP, tobacco farmers would require 11 250 tonnes of ammonium nitrate, 1 125 tonnes of compound S, 53 625 tonnes of compound C, 45 000 tonnes of lime, 4,8 million litres of chemicals, 15,5 million litres of fuel, 3,8 million litres of agro-chemical during the forth coming season.
The tobacco industry received a major boost during this year's marketing season, which began during the second week of May, following the adoption of the multiple currency system that has resulted in tobacco farmers receiving proceeds for their crop in US dollars.
Farmers are currently receiving a maximum cash pay out of
US$1 500 with the remainder of their proceeds being paid into their accounts.
This has boosted deliveries for the season as well as brightened prospects for an improved 2009/2010 tobacco farming season.
According to the latest statistics 31,1 million kg of tobacco has so far been sold through both contract and individual sales since the season opened generating US$90,4 million.
The seasonal average prices have also been firming from just over US$2,50 per kg to around US$2,90 per kg.
Contract sales have accounted for most of the tobacco sold so far with 19,4 million kg worth US$56,9 million having gone under the hammer through the system while the remainder 11,6 million kg valued at US$33,4 million have been sold through individual sales.
Be the first to Write a Comment!
Copyright © 2009 The Herald. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
