Chronicle Editor
Oliver Kazunga, Senior Business Reporter
THE Reserve Bank of Zimbabwe (RBZ) has brought excitement to exporters in some sub-sectors of the economy through a 100 percent incremental retention of their export proceeds with immediate effect.
In the past, exporters have been advocating for a review of the retention levels upwards to cover production costs.
In the 2022 Monetary Policy statement issued yesterday, RBZ Governor Dr John Mangudya said, “On account of the high import requirements embedded in the manufacturing, horticulture and cross-border transport sub-sectors of the economy, with immediate effect, exporters in the manufacturing, horticulture and cross-border transport sub-sectors shall be eligible to retain 100 percent of the incremental portion of their export receipts.
“The export base for these sub-sectors have also been refined to incorporate their high import requirements.”
The Governor said the financing models for tobacco and cotton require a refinement of the export retention threshold to increase participation by small-scale growers and to boost tobacco and cotton production in the country.
“Accordingly, the retention threshold for tobacco and cotton growers shall be increased to 75 percent for the forthcoming tobacco and cotton marketing seasons.
“The funds retained by the growers shall continue to be treated as free funds,” said Dr Mangudya.
For the tourism and hospitality industry, which was hard hit by the Covid-19 pandemic, the Apex Bank Governor announced that with immediate effect, players in the sector shall retain 100 percent of their foreign currency earnings to allow them to quickly recapitalise and procure the necessary goods and services required by tourists and travellers.
He explained that under this framework, tobacco merchants will retain 80 percent on the portion of the incremental value addition repatriated into the country and 100 percent of proceeds from local sales of tobacco through inter-merchant sales.
– @KazungaOliver.
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