Zimbabwe: Decline in diamond production as tobacco earnings drop
Tobacco earnings, one of the biggest earners of foreign currency, for 2016 have also slumped significantly, at a time the country is desperate for cash.
Finance Minister Patrick Chinamasa said with the current production rates, the country is not likely to meet the full-year target of 6 million carats. He said production had been affected by various factors, chiefly the consolidation process, which had been met with resistance by some companies.
“We set ourselves a target of six million carats this year, but we are nowhere near that because of the disruptions that came about as a result of the reorganisation of that sector,” Chinamasa said.
Latest figures show that Zimbabwe’s diamond production has declined by 76 percent following the country’s compulsory acquisition of Marange fields in February this year.
Information released by the central bank reveals that rough diamond output dropped to 152,475 carats in the first quarter of this year from 639,377 carats in the same period last year.
This comes as industry experts have questioned the government’s decision to cancel diamond mining companies’ licences to establish the Zimbabwe Consolidated Diamond Company (ZCDC).
Zimbabwe started consolidating mining operations of six companies that were operating in the Chiadzwa diamond fields early this year after accusing them of lacking transparency in their operations.
Meanwhile, Tobacco Industry and Marketing Board spokesman, Isheunesu Moyo says overall output for 2016 is expected to reach 190 million kg, above the target of 160 million kg.
Earnings, however, would suffer a significant decline and this was mainly due to poor quality crop as a result of the drought.
According to latest statistics, tobacco worth $502,560,971 had been auctioned by mid-July. In the same period last year, 161,937,909kg of tobacco was sold, raising $479,314 814.
The contract farming system handled 138,436,613kg and the auction system recorded 32,326,694kg.
According to TIMB, seasonal tobacco exports have raked in $271,139,128, with China being the largest importer. More than half of Zimbabwe’s tobacco crop is exported to China every year.
The four-month 2016 marketing season ends Friday.