Zimbabwe Loses $6 Billion Tobacco Revenue

Source from:  New Zimbabwe  10/31/2014

Zimbabwe  lost no less than $6 billion through the selling of unprocessed tobacco to external markets last year alone, a policy analyst Butler Tambo has revealed.

Tambo told a workshop organised by lobby group Bulawayo Agenda in the country's second largest city titled "Ideas Festival," on Thursday that the country could have realised the same amount if its tobacco sold to Europe and Asia had been processed into cigarettes.

The analyst said Zimbabwe's youths should be mentored in a way that allows them to venture into value addition and import substitution on which the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (ZimAsset) blueprint could be anchored.

"For instance while a kilogramme of unprocessed tobacco costs an average of  $3,66 per kilogramme at the auction floors, threshed tobacco costs around $7,30 per kilogramme while cigarettes cost around $30,50 per kilogramme," he said.

"In monetary terms, from the 166 million kilogrammes of raw tobacco sold last year and exported to various countries around the world at a cost of $608 million, Zimbabwe could have realised as much as $6,08 billion from finished cigarettes," Tambo said.

He said government needed to stop the idea of spoon-feeding youths with loans that are never repaid.

"Youths have gotten loans but there is a growing culture in Zimbabwe of treating loans like manna from heaven.
"They need to be empowered but cannot be troubled to pay back, we need a culture of good economics and it begins with the government itself," he said.

Zimbabwe's annual budget currently stands at $4 billon including over a $1 billion deficit. Tambo's calculations mean tobacco alone can ensure the country has with a fiscal surplus.Enditem