The Reserve Bank of Zimbabwe (RBZ) will deposit $29,8 million to tobacco growers at the end of the month as the apex bank moves to implement the 5% export incentive scheme meant to grow the country’s export receipts and boost the liquidity situation.
BY FIDELITY MHLANGA
RBZ governor John Mangudya on Friday said the incentive scheme was geared towards increasing tobacco production, which has become the second source of liquidity in the country.
“We are going to give tobacco producers an incentive. As the tobacco industry, there is $29,8 million. You are the biggest beneficiary and by the end of November the entire amount will be [deposited] into accounts,” Mangudya said at a function to mark the end of the tobacco season.
Mangudya said tobacco farming was becoming a pillar of the economy, adding that combined with gold, the two were earning the country $1,6 billion in exports receipts.
He said the tobacco marketing season was key as it oiled the nostro accounts.
“If we don’t have a tobacco farming season, the nostro accounts run dry and this shows how important tobacco farming is in Zimbabwe,” he added.
The apex bank chief said the nostro accounts were constrained because they were funding both local and foreign payments. Banks have put restrictions on the use of Visa/MasterCard for local transactions.
The export incentive scheme is coming under the $200 million facility guaranteed by the African Export-Import Bank.
Exporters will be paid in bond notes, which will be at par with the United States dollar. RBZ is set to introduce bond notes in denominations of $2 and $5 by the end of the month with an awareness campaign already in full swing.
On Thursday, Mangudya said the export incentive scheme was also meant to cushion exporters against price decreases which would ultimately eat into their profits.
Miners have had to grapple with reduced prices on the international markets. A projected rate hike in the United States would see investors flocking to the money markets and dumping commodities like gold which would affect the price of the yellow metal.
Statistics from RBZ showed that gold output was up 16% to 15,3 tonnes in the nine months to September from the comparable period last year when 13,1 tonnes of gold were delivered to Fidelity Printers & Refiners — the country’s sole gold buyer.
Artisanal miners contribute over 40% to the total output.
“If prices of gold go down, the miners will be forced to smuggle the gold and leakages will occur. The export incentive comes in as a cushion,” Mangudya said.