GOVERNMENT says the tobacco industry remains the cornerstone of the national economy supporting the livelihoods of more than 160 000 households while contributing significantly to the country’s Gross Domestic Product (GDP) and export earnings.
Speaking during the official product launch by Swan Valley Group last week, Industry and Commerce minister, Nqobizitha Mangaliso Ndlovu said the growth of the tobacco sector should align with environmental stewardship and the need for sustainable practices within the industry.
He said the industry was the cornerstone of Zimbabwe’s economy contributing more than 10% to the country’s GDP.
“With export earnings reaching US$1 billion by October 2024, Swan Valley’s entry into manufacturing will strengthen this trajectory by contributing to tax revenue through excise duties and value-added tax, thereby enhancing the government's fiscal position.
“In line with the National Development Strategy 1, Swan Valley has made significant investments exceeding US$15 million and is now part of our structural transformation drive through value addition.
“Such efforts not only enhance employment but also support the overarching goal of transitioning Zimbabwe into an empowered and prosperous upper-middle-income society by 2030.”
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Ndlovu said government was committed to fostering private sector growth initiatives.
“Policy support to market access, the public-private partnership model is yielding tangible benefits, as seen in the success of companies such as Swan Valley,” he said.
Lands and Agriculture deputy minister Vangelis Haritatos said the launch underscored the success of the country's tobacco value chain transformation plan introduced in August 2020.
“The tobacco growing sector has become a major source of livelihood for over 155 000 registered tobacco growers and 37 registered contractors and is currently, while at the same time accounting for more than 50% of agricultural exports and 12% of agricultural GDP.
“Since the successful growing of the first flue-cured tobacco by missionaries in Italy in 1894, the industry has grown in leaps and bounds, resulting in Zimbabwe being one of the global leaders in flue-cured tobacco production,” he said.
Haritatos said the land reform program saw a shift in production dynamics from a situation in 1998 where about 1 500 large-scale commercial farmers produced 239 million kilogrammes of tobacco to the current state where the primary producers are predominantly smallholder farmers who constitute 855 of the current grower base.
“Central to the success of the radical transformation is the private sector. As government, our role is to crowd as many players into the sector to create a healthy competitive environment.
“The only way we can achieve a US$5 billion tobacco sector is through the collective and collaborative effort of all players in the agricultural space.
“This target is only the beginning of the journey to ensuring that we secure more than 6% of the international market share,” he said.
Swan Valley Group managing director Mutemwa Ushewokunze said the company planned to increase tobacco production by 33% next year.
“We need to be creating products that we can send overseas and bring back in export revenue. We have purchased an additional production line, which we expect to arrive sometime before the end of the year,” he said.