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Tobacco farmers to receive prompt payments

Tobacco farmers to receive prompt payments

THE 2021 tobacco marketing season opens on Wednesday with the Government putting in place an improved and smooth payment system which will see tobacco growers receiving their payment within 10 minutes of selling their product.

Government, through the Tobacco Industry and Marketing Board (TIMB), has also adopted a stricter and stringent regime of Covid-19 health protocols that restrict access to the floors to one person per delivery.

Under the new rules, flea markets and hawking will not be permitted around the premises of tobacco auction floors.

Speaking soon after touring tobacco auction floors on Wednesday last week, Lands, Agriculture, Fisheries, Water and Rural Resettlement Deputy Minister Vangelis Haritatos said the new payment system is efficient.

“There is no need for tobacco growers to go even one day without being paid. The systems are so efficient that they have guaranteed us that within 10 minutes that some form of payment will be arranged. So the farmers come in with the produce, they deliver and almost immediately the account is credited, we don’t see any challenges, the money is coming in.”

In the past, payment for tobacco deliveries could take days to be processed.

On side marketing, Deputy Minister Haritatos said the ministry was taking a no nonsense approach to those who try to cheat the system.

“We keep encouraging and telling our farmers that farming is indeed a business. Through the TIMB, the systems are all integrated, they all talk to each other. So if have been contracted to TIMB and I try and sell my product to another floor or another contractor, basically I will be blocked because the systems talk to each other.”

Last week, the Reserve Bank of Zimbabwe (RBZ) said it had put in place effective payment procedures to ensure merchants and farmers can retain or be paid 60 percent of their net revenue in foreign currency and 40 percent in local currency.

In a letter addressed to the TIMB, the RBZ said:

“For tobacco that is purchased through the auction floors system, tobacco merchants shall put in place mechanisms to ensure that auction floors have the requisite foreign currency to expeditiously pay the tobacco growers 60 percent foreign currency entitlement,” the RBZ said.

“Tobacco merchants who have failed to secure offshore lines of credit for buying tobacco from farmers shall apply to exchange control for authority to use locally sourced funds and proof of inability to secure off shore lines of credit would be required, including a supporting letter from the TIMB.”

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