IT’S undeniable that tobacco is one of the country’s top forex earners and it, therefore, follows that producers of the golden leaf ought to be treated with extreme care given their key role in sustaining the economy.
It will be foolhardy for government to thumb its nose at the goose that lays the golden egg in a rapidly deteriorating economy.
Over the past two seasons or so, government has been giving the farmers a raw deal especially when it comes to the marketing of the golden leaf and this will surely force most farmers to drop the crop for other alternatives and eventually plunge the country’s agro-based economy into the abyss.
It has become a tradition that each successive tobacco marketing season is characterised by squabbles relating to the marketing of the golden leaf and this is unsustainable in the long run.
Last year, the tobacco marketing season was marred by currency volatility and disagreements over the quantum of the crop sold in foreign currency, and it seems the same challenges have been rolled over to this year.
The tobacco selling season opened a fortnight ago and due to the COVID-19 lockdown, farmers have been barred from visiting the auction floors. Instead, they are to surrender their crop to transporters to be sold in their absence.
This, unsurprisingly has caused outrage among tobacco farmers who feel that this could shortchange them as they would have no control over how their crop is sold.
As a result, tobacco farmers in most parts of the country have reportedly withheld their crop refusing to release the golden leaf to transporters to be sold at the auction floors under such conditions. Reports that tobacco floors are selling a paltry 500 bales of tobacco per day instead of 3 500 bales on peak days are indeed a cause of concern.
To make matters worse, transporters have also parked their vehicles in protest over meagre payments at auction floors in local currency after incurring huge costs in foreign currency. The chaos speaks to the lack of consultation between the authorities and tobacco farmers.
Lack of consultation over the payment of half of the crop in local currency by the central bank last season led to auction floor deliveries plunging from an all-time high of 76,8% in 2004 to 14% last season. That lack of consultation is again threatening the current tobacco season is evidence that government has not learnt its lesson from the catastrophic plunge of deliveries last season.
Inasmuch as it is necessary for government to put in place precautions at the tobacco floors to contain the devastating impact of COVID-19, which has affected more than four million people with more than 300 000 fatalities globally, there is need for a buy-in by the tobacco farmers of the measures to create a win–win situation. Government can hardly afford to be at odds with tobacco farmers who bring in the much-needed foreign currency given its parlous financial position worsened by the effects of the scourge.
One only needs to look at the leaked correspondence by Finance minister Mthuli Ncube to international financial institutions, where he pointed out that the country’s economy will contract by 15% to 20%, adding that the advent of COVID-19 will spawn a national catastrophe that will have potentially adverse effects regionally, to see just how desperately dire the situation is.