Members of Parliament have resolved to invite Treasury and the central bank to explain the mitigatory measures to assist cotton farmers after firms buying the lint stopped making payments following a recent suspension of mobile money platforms.
Cotton buying firms told a visiting Parliamentary Portfolio Committee on Agriculture, Water and Resettlement in Gokwe last weekend that they had stopped paying cotton farmers for their produce after Government suspended bulk payments and EcoCash merchants in its bid to stamp out illicit money activities.
During the tour in Nemangwe and Chitekete business centres in Gokwe district, the committee’s chairperson Cde Justice Mayor Wadyajena (Zanu PF) told the farmers and firms that they will engage Finance and Economic Development Minister, Prof Mthuli Ncube and Reserve Bank of Zimbabwe Governor, Dr John Mangudya, to establish what they were doing to assist farmers to continue accessing their money.
This was after Cottco business manager, Ms Praise Makombore, told legislators that they were unable to make payments to farmers because of the suspension of the mobile money platforms.
“We had just started paying cotton farmers when Government suspended bulk payments for mobile money platforms. You will realise that the mobile money platform was the only means through which we were paying farmers given that most of them have no bank accounts. We have since stopped the payments because our mobile lines have been disabled following the suspension,” said Ms Makombore.
There was also a call to raise the daily EcoCash withdrawal limit saying farmers would require six days to buy a product worth $30 000, for instance, since the limit is now pegged at $5 000 per day.
The committee heard the plight of Mr Edson Kalungwe at Chitekete Business Centre who has 224 bales and would need several months to use his earnings from EcoCash.
A farmer gets an average of $10 000 per bale and with 224 bales, Mr Kalungwe is set to pocket almost $2 million and that would require several months to be used given the obtaining daily limit.
Other farmers bemoaned the producer price of cotton pegged at $43,94 per kg saying it would not help them get meaningful returns that have traditionally been associated with cotton growing.
In response, Cde Wadyajena said his committee will engage Prof Ncube and Dr Mangudya over the farmers’ plight.
“We have heard your concerns. They are quite legitimate, particularly the effect of suspending bulk payments, how it has impacted on you as cotton farmers.
“We will therefore engage Prof Ncube and Dr Mangudya. We want to find out what mitigatory measures they were taking to address that. Thereafter we will compile a report before the plenary of Parliament with our recommendations,” said Cde Wadyajena.