Maize imports gobble US$42m monthly

LIVINGSTONE MARUFU

Foreign currency starved Zimbabwe is spending US$42m on genetically modified and ordinary maize imports in an effort to supplement food for the country which continues to experience very low agriculture productivity levels caused by the El Nino-induced drought.

Zimbabwe needs 1.8m tonnes of cereals annually but is likely going to get a harvest of around 800 000 tonnes of maize this season necessitating the need for imports to feed the starving eight million people.

The development comes at a time when the economy is experiencing a meltdown, rampant inflation, crippling foreign currency shortages, power outages and low productivity levels.

Reserve Bank of Zimbabwe governor John Mangudya told Business Times that the country will import any maize whether GMO or ordinary to ensure citizens are fed.

“Grain is draining the country a great deal of United States dollars daily; we are spending US$1.4m daily and US$42m monthly to import maize from other parts of Africa and South America to ensure the country has enough food at any given time,” Mangudya said.

This means that Zimbabwe will spend over US$500m yearly on grain imports. Mangudya said Zimbabwe imports maize through the Grain Marketing Board (GMB) and millers where 3500 tonnes are imported at a price of between US$340 and US$375 per GMO tonne and US$360 to US$400 per tonne of non-GMO maize.

Treasury and central bank are convening every week with GMB and Grain Millers Association of Zimbabwe to discuss the state of food security in the country.

RBZ said low productivity levels will cause the country to use more forex on food imports instead of utilising it for other developmental issues.

Rain-fed agriculture is no longer sustainable these days due to the effects of climate change hence money should be invested towards construction and rehabilitation of irrigation facilities to improve productivity.

In the 2020 National Budget presentation, the government set aside over ZWL$422m for irrigation infrastructure as it moves towards sustainable smart agriculture which will help to save the much-needed forex.

Experts say drought cycles have reduced to drought every two years from the previous 10 years due to accelerated climate change effects.

It is believed that severe cutting down of trees and veld fires hastened the effects of climate change and caused severe droughts and extreme weather patterns, causing the country to endure drought on a yearly basis.

More so, Zimbabwe finds itself doing supplementary budgets to sustain the effects of reduced agriculture performance.

Mangudya said subdued agriculture performances are the major reason why miners do not get 100% forex retention levels as all people in the country need to be fed from the country’s resources.

Finance and Economic Development Minister Mthuli Ncube said the budget came under a difficult economic environment which was aggravated by a severe drought which caused food security with negative spill-over effects to the rest of the other sectors of the economy.

Ncube projected that the country will have an improved agriculture season in the 2019/2020 summer cropping season and will help the economy to grow by 3% in 2020.

“Economic recovery primarily premised on expected better rainfall season supported by increased support towards rehabilitation and development of irrigation infrastructure to sustain agriculture.

“Better planning for increased agriculture production will also be crucial for food security and forex generation,” Ncube said.

Treasury moved import substation programme from government-led agriculture to the private sector with over ZWL$2.8bn set aside.

In the same vein, the government is moving to make 99 year leases bankable as this will remove the necessity of government guarantees to boost productivity.

Government expect better rainfall patterns to help the agriculture sector to grow by 5% this year.

Treasury is also creating a fiscal buffer of ZWL$165m in case the country experience another drought in the current agriculture season.

The country is targeting 200 hectares per district on its current irrigation programme and will start using solar systems to mitigate against power outages.

Agriculture experts said the economy could save up to US$1.3bn yearly if it successfully implements its import substitution programmes.

Economist Gift Mugano said Zimbabwe should properly implement import substitution programmes as localised production will improve the country’s export earnings.

“If we produce soyabeans up to 300,000 tonnes we will save US$200m, enough maize requirements would save us US$300m, while sufficient wheat production will save US$200m, localised rice production will save the country US$150m and other command products like potatoes will save over US$200m.

“We can’t be found importing toothpicks when we have a lot of trees in Manicaland, we should invest in these trees to ensure we can get value out of them,” Mugano said.

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