THE Reserve Bank of Zimbabwe (RBZ) has so far released $35 billion of the $60 billion set aside for maize procurement from farmers by the Government through the Grain Marketing Board during this selling season.
In light of this year’s expected bumper harvest, RBZ Governor Dr John Mangudya has allayed fears that the Government accounts will not meet payments for maize deliveries to the Grain Marketing Board (GMB), a situation which would compel monetary authorities to print more money.
Increasing money supply growth in the economy has a net effect of creating inflationary pressures on the market.
Zimbabwe this year expects to produce 2,5 million to 2,8 million tonnes of maize and 360 000 tonnes of traditional grains, which yield could be the largest achieved by the country since the fast-track land reform commenced in 2000.
Speaking by telephone from Harare over the weekend, Dr Mangudya said they have released $35 billion to pay farmers for over one million tonnes of maize delivered to GMB so far since the beginning of the marketing season in April.
“We are expecting to spend $60 billion and $35 billion has been spent to purchase maize from the farmers. Over one million tonnes of maize have been purchased from the farmers and that money is also the money that is going into the market,” he said.
Dr Mangudya is on record saying the $60 billion that is required to pay the farmers for grain deliveries to GMB this season was needed over time during the marketing season.
This means that the money was not required in one day and so no more money would be printed by the Central Bank.
During this marketing season, GMB is buying maize at $32 000 a tonne from $21 000 per tonne last year.
Meanwhile, GMB has introduced a new payment platform through a Zimswitch-enabled Farmer Card System which allows farmers to receive instant payments for their grain upon delivery.
The farmer card can also be used through a Point-of-Sale Machine (POS) to buy goods and services.
The marketing board has embarked on a rebranding exercise transitioning from being predominantly a grain storage entity to a key player in the agricultural value chain.
This is part of efforts by GMB to reposition itself into an active participant in the agricultural value chain in line with Vision 2030 where Zimbabwe under the Second Republic aims to attain an upper middle-income economy status where the GDP per capita of US$3 500 will be realized.