Paidamoyo Chipunza Senior Reporter
Tobacco farmers will get 50 percent of their earnings in foreign currency when the marketing season gets underway on Wednesday, up from 30 percent proposed earlier.
A joint statement signed by Reserve Bank of Zimbabwe governor Dr John Mangudya and Tobacco Industry and Marketing Board (TIMB) chief executive Dr Andrew Matibiri, indicated that the money would be deposited in the farmers’ foreign currency accounts (FCAs).
The remaining 50 percent will be credited into their Real Time Gross Settlement Dollars (RTGS$) bank accounts.
According to the statement, growers who opt to have 100 percent of their tobacco sale proceeds deposited into their RTGS$ bank accounts will be allowed to do so without the need to open a Nostro FCA bank account.
“The Reserve Bank of Zimbabwe has put in place payment measures to ensure that tobacco growers who are going to sell their tobacco during the 2019 marketing season are paid within the shortest possible time,” reads the statement.
“Tobacco sale proceeds shall be deposited into the growers’ RTGS$ bank accounts and Nostro FCA bank accounts.”
To assist growers in accessing cash for incidentals at the point of sale, the RBZ and TIMB said growers shall be entitled to withdraw cash equivalent to RTGS$0,50 per kg of tobacco sold, up to a maximum of RTGS$300.
Tobacco growers who fail to access their cash entitlements on the day of the sale as a result of logistical bottlenecks, the statement read, will be allowed to access their cash entitlements within five working days from the date of the sale.
“Tobacco growers who have not yet opened Nostro FCA bank accounts, are kindly advised to do so by approaching banks which hold their individual RTGS$ bank accounts, and present their national identity card and grower’s number,” read the statement.
Small-scale tobacco growers growing tobacco on two hectares and below are entitled to retain sales proceeds in their Nostro FCA for an indefinite period as free funds.
Large scale tobacco growers with more than two hectares of the crop are entitled to retain sales proceeds in their Nostro FCA for a period of 180 days.
“After 180 days, the Nostro FCA balance shall be offloaded onto the market at the ruling interbank market exchange rate,” read the statement.
The 2019 tobacco marketing season will officially open on Wednesday, with the contract floors opening the following day.
Tobacco production has been on the increase in the past years, especially after the land reform saw indigenous farmers venturing into growing the crop that was a preserve of a white minority.
So far, more than 170 000 farmers have registered for the 2018/19 marketing season.