Reserve Bank of Zimbabwe’s move to pay an export incentive scheme financed through bond notes seems to be paying dividends with the country recording a 10 and 17 percent rise in tobacco farming and gold production respectively.
In his 2017 Monitory Policy Statement released on Wednesday, Central Bank Governor, Dr John Mangudya revealed that during the current summer cropping season, tobacco farmers have increased the hectarage by around 10% compared to the same time last season.
“Tobacco farmers have increased the hectarage under this agricultural season by around 10% from 97 000 hectares planted in 2015/2016 to 107 000 hectares with an expected output of 200-215 million kilograms of green leaf tobacco.
“The gold sector has also responded positively to the incentive scheme and the monitoring process by the Gold Mobilisation Committee resulting in the increase in gold delivered to Fidelity Printers and Refiners (FPR by 17% from 18,3 tonnes in 2015 to 21,4 tonnes in 2016,” Dr Mangudya said.
He added that Gold delivery to FPR, which excludes the gold from Platinum Group Metals (PGMs), is expected to be 25 tonnes in 2017.
Dr Mangudya revealed that his office is implementing a number of policy measures aimed at transforming Zimbabwe’s growth model in line with ZimAsset.
Chief among the yet to be introduced policies is the ease and cost of doing business reforms, Public Finance Management Framework and the Special Economic Zones among others.
“The positive spin-offs from the recent removal of Zimbabwe from the International Monetary Fund (IMF) remedial measures, following successful clearance of its arrears to the Fund in October 2016, are also expected to go a long way in reducing Zimbabwe’s country risk, thus attracting the much needed foreign investment,” added Mangudya.
He stated that clearance of external debt arrears to the rest of the international financial institutions such as African Development Bank (AfDB), World Bank and European Investment Bank (EIB) is expected to further reduce the country’s debt burden that continues to affect Zimbabwe’s access to foreign finance for the past 16 years.
However, Dr Mangudya was skeptical about the implementation and effect of Brexit in Europe as he said this will have an impact on the trade relationship between Britain and the rest of Europe and also between Africa and Europe.
He noted with concern that the depreciation of the British Pound following the vote to leave the EU will affect the size of remittances to countries such as Zimbabwe.