17 February 2018

Zimbabwe: RBZ Doubles Gold and Tobacco Support

The Reserve Bank of Zimbabwe (RBZ) has increased support to tobacco and gold production by over 100 percent as the apex bank strives to improve export earnings.

The development follows a sterling performance by the two sectors in raking in foreign currency for a country battling a liquidity crisis attributed to excessive imports against low exports receipts.

Farai Masendu, director exchange control at the RBZ, said the expanded input facility was already in place ready to boost production.

"In order to enhance foreign currency inflows from tobacco and gold production, the tobacco input finance facility has been increased from $28 million disbursed in 2017 to $70 million, while the gold support facility has been increased from $74 million in 2017 to $150 million," Masendu said in a directive this Friday.

About 25 tonnes of gold were delivered to RBZ's Fidelity Printers and Refiners last year up from 21 tonnes while tobacco exports increased by seven percent, earning $827, 4 million in 2017 compared to $771, 8 million the previous year.

The central bank also went further to call for the prioritisation of companies involved in gold value addition for export.

"In order to enhance jewellery manufacturers' contribution to foreign currency earnings, Fidelity Printers and Refiners shall prioritise the sale of gold towards export-oriented jewellery production," said Masendu.

"Where the jewellery manufacturer purchases gold from FRP using RTGS funds, upon export of the jewellery, the manufacturer shall retain 35 percent of the export value for own use within the 14-day retention period."

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