Improve local funding for tobacco production in Zimbabwe: Experts

Published Jun 8, 2024

Tridge summary

Zimbabwean farmers are advocating for increased local funding for tobacco production, which currently relies heavily on off-shore financing. They argue that local funding is more expensive and that the current contract farming model is not beneficial to them. The farmers also highlighted the lack of collateral security as a barrier to borrowing and stressed the importance of retaining a larger share of the value added in the tobacco value chain. Stakeholders, including the Zimbabwe Tobacco Growers Association, Zimpapers, and the University of Zimbabwe, were in agreement that a localisation strategy and sustainable practices are necessary to maximise the benefits for local farmers and to add more value to the tobacco crop.

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Original content

Source: The Herald – Breaking news. Precious Manomano FARMERS have called on the Government to initiate ways of improving local funding for the country’s tobacco production to ensure they derive maximum benefits from their crop. Currently, tobacco is financed mainly through off-shore funding, with 95 percent of the farmers under contracts and only 5 percent being self-financed. As it stands, Zimbabwe retains around 12,5 percent of the value of its tobacco, with the remainder paying back loans and interest from off-shore financiers. The event was attended by stakeholders in the tobacco Industry. Zimpapers chief finance officer, Mr Farai Matanhire, gave the opening remarks on behalf of chief executive, Mr Pikirayi Deketeke. Zimbabwe Tobacco Growers Association chairman Mr George Seremwe said production costs had gone up, and local banks could not finance farmers. Local funding was currently more expensive for most merchants than off-shore, and merchants were thus reluctant to take ...

Source: Zimbabwesituation