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Buyers busy at the tobacco auction floors in Harare in this file photo

Prince Sunduzani, Business Reporter
MANUFACTURING industries are pinning their hopes on the opening of tobacco auctions next week to increase foreign currency earnings for the country which will assist them in procuring key raw materials.

Confederation of Zimbabwe Industries president, Mr Sifelani Jabangwe, told Business Chronicle yesterday that most industries were left with less than three weeks’ supply of raw materials and there was an urgent need for forex for them to continue operating.

He said Government should start making allocations as a matter of urgency since some industries were on the brink of shutting down.

“We are looking forward to the opening of the tobacco auction floors next week because most companies are at the limit of their credit lines. The forex allocations have been very low such that a number of companies are saying they are in deep trouble,” said Mr Jabangwe.

“They need allocations now; otherwise they cannot go beyond the next three weeks without shutting down some of their operations if not all.

“With auction floors opening next week, we believe that some of the money has started to trickle in and should be accessible to banks and the RBZ. So they need to start making the allocations now and not tomorrow.”

Tobacco is one of the major foreign currency earners and the opening of auction floors brings hope to the economy. Last year Government increased foreign currency allocations to manufacturing firms under the $600 million nostro stabilisation facility to enable companies to procure critical raw materials and increase supply of goods.

Mr Jabangwe said 2018 has been tough for industry due to low foreign currency inflows, but said they were anticipating an improvement in the coming months.

He applauded the RBZ for its efforts in managing the distribution under tough circumstances where it is not enough for industry.

“The year has been very tough because of the nature the country generates currency. The major concern has been foreign currency, we have been surviving with the little that we had but now we are at the end of that cycle. But we believe that it is going to be a good year, and a number of our companies are looking to export this year so that we can contribute to foreign currency generation,” said Mr Jabangwe.

@PrinceNkosy102