Minister Bimha
Golden Sibanda Senior Business Reporter
Government has implored a Chinese State-owned tobacco firm to increase funding in tobacco contract farming and consider investing in the manufacture of cigarettes.
Industry and Commerce Mike Bimha said in an interview on Friday that the Chinese company was already supporting local farmers and Government had implored it to increase its financial support to tobacco growing.
Minister Bimha said the request was made during a recent high powered Government delegation’s visit to the Peoples Republic of China led by President Mugabe, when several multi-million dollar deals were signed.
The visit to China was meant to explore furthering bilateral economic and investment opportunities while also seeking to ensure mutual understanding in terms of the Chinese requirements for bankable and viable projects.
“I also had an opportunity to visit one of the State owned monopolies in China, a company that handles tobacco matters and already here in terms of contract farming,” he said.
Chinese company Tian Ze Tobacco has been hailed for choosing to invest in Zimbabwe’s contract tobacco farming when very few investors were willing to do so.
“We appealed to them that we would want to see more of contract farming, so that they come here and partner us to grow more tobacco . . . that they provide more assistance in funding in contract farming,” he said.
Already, Zimbabwe enjoys positive trade balance with China and Minister Bimha said during the visit to China, the Asian economic giant showed willingness to grow the trade, especially involving value added products.
Minister Bimha said the purpose of the meeting with the tobacco firm in China was to express Government’s appreciation of the firm’s role in contract tobacco farming and offering farmers good tobacco prices. Most of the support goes to A1 and A2 farmers resettled under Government’s land reform programme.
The farmers who benefited from Government’s fast track land reform programme, were mostly marginalised and landless poor black indigenous farmers.
“We also left them with something to think about where we are saying that we want them here in terms of value addition of our tobacco, so that we can manufacture (more) cigarettes and look at other markets, such as the Middle East, and that we do this together.
“We left them with these proposals and I believe that they were well received, but obviously they would want to consider them and do certain exercises,” he said.
Industry experts contend that if the country processed all the tobacco it produces into cigarettes, it would be able to rake in about $6,5 billion from the exports.
Zimbabwe’s auction tobacco centres have so far this year taken delivery of 216 kilogrammes of the cash crop in what has generated about $680 million in sales.
Minister Bimha also said that during the trip to China, finance Minister Patrick Chinamasa engaged several financial institutions, most of them State owned, with a view to secure lines of credit to support the economy; especially mining, agriculture and manufacturing.
To that end, projects considered for prioritisation for Chinese investment or funding included agriculture, energy, information communication technology, and social sectors.
Investment in the key sectors is critical to address deficiencies in key enablers central to unlocking the investment and economic growth potential Zimbabwe holds.
“We would like to see more support from State owned financial institutions in terms of extending lines of credit, which would be targeted at productive sectors, which is also where the need is felt most,” he said.
Minister Bimha said the meetings in China were well attended, including by top diplomats resident in that country, while the country’s political leadership pledged unwavering support for viable projects in Zimbabwe.
Chinese firms are already supporting major multi-million dollar projects in the form of expansion of Kariba South Hydro Power Station and Hwange Thermal Power Station and China Africa Sunlight Energy’s coal bed methane initiative, which will also include the construction of a thermal power plant and dam.