Fri, 26 Feb 2021

Cotton Farmers Decry End of Cash Payments

Global Press Journal
20 Jan 2021, 08:34 GMT+10

Gamuchirai Masiyiwa, GPJ Zimbabwe

Chedra Ganye looks for bedding at Spinweave, which sells local cotton products. Zimbabwe's struggling economy has hurt the cotton industry.

Editorial Team Publication Date

HARARE, ZIMBABWE - Cotton farming runs through Loveness Ngwendu's veins.

Her parents grew the crop, and in 1997, she decided to do the same in the hot, arid climes of Checheche, a rural area in eastern Zimbabwe's Chipinge district. Until recently, cotton met her needs.

But no more. Ngwendu has abandoned cotton farming.

Voice shaking with anger, the 41-year-old says a bale of cotton used to earn her enough money to buy a cow. Today, that would be impossible, she says, as the government now pays Zimbabwe's cotton farmers not with cash but in groceries and goods.

Zimbabwe's cash-strapped government can't pay cotton growers in hard currency. The crisis endangers the livelihood of the country's 400,000 cotton farmers and threatens to do deep economic harm to rural areas that depend on Zimbabwe's second-biggest cash crop.

"We did crop production expecting that we will be remunerated handsomely and improve our livelihoods," says Ngwendu, a married mother of six. "At first, we were told that we will be given cash in Zimbabwean dollars, then later heard that they were now going to give us groceries instead."

Gamuchirai Masiyiwa, GPJ Zimbabwe

Kudakwashe Mashayamombe, a salesperson, rolls cloth with a machine and tags it at Spinweave, a Harare company that sells local cotton products. Cotton is Zimbabwe's second-biggest cash crop.

She says that since June, the Cotton Company of Zimbabwe (Cottco), the government-owned corporation that dominates the cotton industry, hasn't paid her cash. Instead, she has received two dozen bottles of cooking oil and 20 bars of soap.

The exchange of cotton for groceries and goods is part of the Presidential Inputs Scheme, in which the government supplies Zimbabwe's cotton growers with seed, fertilizers and chemicals. After their harvest, farmers sell the cotton to Cottco at the prevailing market price.

The government runs a similar program for maize farmers.

The inputs program began in 2015, when cotton farmers produced only 30,000 metric tons. At first, farmers received cash for their crops. Growers say that changed last year. Now, many farmers have ditched cotton, saying they can no longer make a living growing what Zimbabweans often call "white gold."

Produced mainly by small-scale farmers, cotton is second only to tobacco as a crop that earns foreign currency. In 2019, Zimbabwe exported cotton worth $42.4 million to South Africa.

Cotton flourishes in dry, hot regions across the country, such as Gokwe, Chipinge and Muzarabani. During harvest season, Checheche's fields are awash in sorghum, maize and waving white cotton plants.

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Until 2009, cotton farmers were paid in local currency. Then, between 2009 and 2016, according to a report by the Southern African Parliamentary Support Trust, growers could rely on full cash payments in United States dollars.

By 2016, cash had dried up for a variety of reasons - including weak foreign direct investment, low exports, reduced diaspora remittances, and the growth of the informal labor sector.

Because of the cash shortages, officials encouraged farmers to open bank accounts and electronic wallets and began splitting up payments - half in cash and half to farmers' accounts upon delivery of their cotton.

At the same time, cotton production was plummeting, and the government launched the Presidential Inputs Scheme. Pious Manamike, acting chief executive officer for Cottco, says the program has worked, noting that between the 2015-16 and 2017-18 seasons, seed cotton production vaulted from 30,000 metric tons to 144,000 metric tons.

In 2018-19, after Cyclone Idai ravaged the country, production slid back to 76,000 metric tons of seed cotton. Manamike says a government decision to suspend bulk payments using mobile platforms made it impossible to pay farmers, and that forced Cottco to start giving growers groceries and goods such as bicycles, motorcycles and plows.

Cotton is a key source of income for rural growers, so farmers need monetary payments, argues Prince Kuipa, chief economist of the Zimbabwe Farmers Union.

"That cash is for looking after a number of people in Zimbabwe," he says. "Farmers need to be paid in cash and must be able to make their own decisions on where the money is invested. But when they are given groceries, that right is taken away from them. Some would want to repair their equipment or pay for labor."

Manamike defends Cottco's decision to pay growers with non-cash items. In fact, he says, farmers asked Cottco to pay them this way.

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"Farmers got real value for their money through groceries and were quite happy about the groceries, especially women, as men abuse cash," he says. "Nevertheless, there was also a backlash from a section of farmers who were now crying foul that their privileges have been taken away."

Manamike says Cottco still owes farmers about 1.5 billion Zimbabwean dollars (ZWL) ($18.3 million). He says the company is working with the government to ensure that farmers receive their earnings.

Enock Porusingazi, a member of Parliament from Chipinge South and a member of the Parliamentary Portfolio Committee on Lands, Agriculture, Rural Resources, Water Development and Rural Resettlement, agrees that farmers need money but says other challenges stand in the way.

"With the prevailing economic situation, if you receive a deposit in your account, it does not mean you will be able to withdraw that money," he says, referring to Zimbabwe's cash shortages and other economic struggles. But he believes cotton companies should receive preference to withdraw money and set aside certain amounts for farmers.

Ngwendu, a tall woman who is open and direct, says her family depends on her income, as her husband had an accident years ago and cannot work. She says she can't afford school fees for her four children - ages 8 to 17 - who are in school.

She has turned to producing sesame seed. It's not a major crop in Zimbabwe, but Ngwendu says Mozambican companies buy the seed with foreign currency.

"I hope this will enable me to meet my day-to-day needs," she says.

Gamuchirai Masiyiwa is a Global Press Journal reporter based in Harare, Zimbabwe. She is an internationally acclaimed economy and education reporter.

Gamuchirai Masiyiwa, GPJ, translated some interviews from Shona.

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