Proper management of the recently opened tobacco selling season will help bring some level of stability in the economy, at a time the country is battling devastating effects of Covid-19 induced problems, analysts have said.
Increased liquidity in the official channels will bring some relief to the economy and eventually push down the exchange rate on the illegal market in line with the rule of supply and demand and bring stability to prices of goods.
This year’s selling season is a peculiar one with farmers required to make a single delivery weekly as part of measures to reduce the spread of the deadly disease that has affected over two million people across the globe.
Among the key measures put in place by authorities include implementation of decentralised floors to reduce the number of people coming to Harare.
There are concerns if unchecked that the decentralised floors may be a breeding ground for unscrupulous buyers promoting side marketing, prejudicing the economy of its true foreign currency earnings.
Economists who spoke to this publication are, however, of the view that proper management of the selling season will enhance liquidity in the official channels, and bring some level of stability on the forex market.
“Farmers are urged to sell their crop at the authorised auction floors and put US$ proceeds to good use especially by procuring equipment for increased productivity. This will help avert the vulture tendencies of middlemen, which if unchecked, can cause a surge in parallel market rate hence causing a spike in prices,” said Pan African Chamber of Commerce board member Langton Mabhanga.
