The Ministry of Lands, Agriculture, Water, Fisheries and Rural Development says it expects the Cotton Company of Zimbabwe (Cottco) to clear about ZW$1.5bn debt to cotton farmers by mid this month.
The government is the major shareholder in Cottco after it increased its stake in the private company from 30 percent to 51 percent shareholding in June last year.
Dr. John Bhasera, the ministry`s Permanent Secretary, told 98.4FM News that Cottco is making weekly payments of ZW$500 million to farmers towards clearing the debt and expects to have made the outstanding payments by mid-March.
“Cottco owes farmers I think about ZW$1bn and we are making some weekly payments in tranches of ZW$500mn per week, that`s half a billion dollars and we should be able to clear that debt to farmers, assisting Cottco. By I think mid-march we should be able to clear that and we are very positive, especially with the support that we are getting from the principal, that is His Excellency the President and also the support we are getting from the Ministry of Finance and Economic Development.”
Cottco owes farmers from cotton deliveries made dating back to the 2020 marketing season.
Dr. Bhasera said the other parastatal in the ministry, the Grain Marketing Board (GMB) had cleared its debt to farmers and is up to date with its payments.
“So, at GMB we don`t owe anything to farmers in terms of wheat deliveries, in terms of maize deliveries, in fact, I think we have forked over ZW$60bn in terms of wheat payments and in terms of maize payments.”
By mid-last year GMB was struggling owed about ZW$5 billion to farmers, prompting the Agricultural Marketing Authority (AMA) to re-issue ZW$5 billion bills to fund the GMB’s grain purchases.