HARARE – Earnings from the sale of tobacco are projected to exceed $1 billion next year after an increase in the export incentive of the commodity to 12.5 percent.
The upward review of an export incentive for tobacco by the Reserve Bank of Zimbabwe to 12.5 percent from 5 percent has been welcomed as an initiative that will improve viability for the sector.
According to State media report, the plan was made on the realisation of tobacco as one of the economy’s biggest foreign currency earner.
With the commodity’s export receipts for this year hovering at $980 million, the move by the central bank is expected to result in earnings reaching more than $1 billion, said ZimTrade chairman Mr Lance Jena.
The incentives will also have a net positive effect to the small scale growers in terms of increasing their income base, improve the quality of the commodity and ensure a rise in the participation of the growers in the banking sector, notes an economist Mr Persistence Gwanyanya.
The upward review of the incentive which will be affected during the 2018 marketing season is also expected to consolidate the agriculture sector’s position as the mainstay of the economy.