The Reserve Bank of Zimbabwe (RBZ) has announced new tobacco incentives including issuance of diaspora financing production bonds and licensing deserving merchants to use huge RTGS funds to purchase tobacco.
The incentives are expected to bring viability in the tobacco sector ahead of the 2018 marketing season.
As the 2018 tobacco marketing season draws closer, the central bank has instituted a cocktail of incentives to ease the marketing and viability of the gold leaf which is one of the biggest and seasonal foreigner currency earner for the country.
To boost production levels, the RBZ governor Dr John Mangudya raised the $28 million tobacco fund introduced this year to produce about 44 million kgs to $70 million, a move likely to ignite small scale farmers’ production to over 100 million kgs in 2019.
The apex bank boss will issue diaspora financing tobacco bonds for the purchasing of the tobacco while deserving merchants will be licensed to use huge sums of RTGS sitting in banks to purchase the gold leaf.
Statistics by the central bank shows that tobacco exports raked in over $800 million in forex last year, which is enough to secure fuel for the whole year.
The opening of the auction floors in the next few weeks is expected to bring relief to the foreign currency challenges bedeviling the country.
Owing to the new measures instituted by the RBZ including the use of plastic money which stands at 96 percent, hopes are high that cash shortages and long queues at auction floors and banks will be a thing of past as most farmers have embraced the use of plastic money.