President rebukes cotton company

Mashudu Netsianda, Senior Reporter
PRESIDENT Mnangagwa has blasted the Cotton Company of Zimbabwe (Cottco) for allowing exploitative companies to buy cotton from communal farmers at extortionately low prices and raking in foreign exchange earnings yet failing to pay the producers on time.

Cottco is the largest cotton producing, processing and marketing company in the country with an 80 percent market share.

The organisation, which is listed on the Zimbabwe Stock Exchange, works with individual cotton farmers, providing agronomic and financial support.

Cotton is a key source of income for hundreds of thousands of rural growers.

The crop is also a strategically important export earner for Zimbabwe.

Government has been funding cotton production since 2014 under the Presidential Free Inputs Scheme.

Writing on his weekly column in the Chronicle’s sister papers, Sunday News and The Sunday Mail, President Mnangagwa said Cottco is failing to act while cotton farmers are being fleeced of their hard-earned earnings by merchants buying up all their cotton at very low prices.

“Those in charge of Cottco must quickly change their ways; there is no time any longer, certainly no patience in us to suffer their reprehensible conduct.

The cotton, after all, by right belongs to the Government by virtue of input support,” he said.

“The earnings being stashed abroad belong to this country.

Government shall have what it is owed; farmers shall be paid what is overdue to them.

Above all, the economy will have all its earnings transparently accounted for by all players, Cottco included.”

President Mnangagwa said the Government has been deliberately supporting cotton farmers through an inputs support scheme that has witnessed a nascent revival of the sub-sector.

“Government moved in to support cotton growers by way of seed, chemicals and fertilisers, all this at no cost to cotton companies.

Once harvested, these risk-averse or downright exploitative companies buy all the cotton, quite often at very low, extortionate prices,” he said.

“Much worse, they do not pay farmers on time or make them have a share in foreign exchange earnings they rake in.

It makes one to wonder what the real goal is.”

The President queried why bona fide corporate bodies simply slaughter the goose that lays the golden egg, while hoping for more, better business the season after.

President Mnangagwa said the Government moved definitively to resuscitate an otherwise dying cotton growing sector.

He said the sector was dying because no one in the cotton business wanted to support cotton growers through backward linkages.

“Yet this is an agricultural sub-sector giving livelihoods to thousands of our people in rural areas.

A product which, over the years, has created numerous cotton magnates, all on the back of unrewarded peasant effort,” said President Mnangagwa.

He said little is done in terms of cotton beneficiation in the country with much of the cotton being exported in semi-processed form.

“The earnings are promptly made to our exporters.

It turns out not all bring back all the earnings back into this economy, let alone share these with peasant farmers who toil in scorching sun to produce this vital input,” said President Mnangagwa.

Government recently approved a dual payment system for cotton farmers which will see them receive payment of their crop in United States dollars as well as Zimbabwe dollars.

Government adopted climate-proofing agricultural practices for cotton production in the 2021/2022 cropping season to increase production levels.

Zimbabwean hand-picked cotton is in high demand across the world and the company’s order book exceeds production volumes.

The country’s cotton deliveries increased by 39 percent to 114 656 tonnes towards the end of the buying season of 2021 from 2020 total output of 82 479 tonnes.

Government is working on completing a transaction to increase its shareholding in Cottco to a controlling interest as it seeks swaying influence in the country’s largest cotton firm.

The transaction would be completed by July 1 this year.

Last year, the Government approved to raise its equity to 51 percent from 37 percent.

Lands, Agriculture, Water, Fisheries and Rural Development Minister Dr Anxious Masuka said the majority shareholding in Cottco will legally empower the Government to provide more funding to the company. – @mashnets.