The Sunday News
Bruce Ndlovu, Sunday News Reporter
THE government has increased its shareholding in the Cotton Company of Zimbabwe to 51 percent, a move that will allow it to have a bigger oversight role on the operations of the entity.
Lands, Agriculture, Fisheries, Water and Rural Resettlement Minister Dr Anxious Masuka said this during a question-and-answer session in Parliament on Wednesday.
Minister Masuka was responding to Member of Parliament for Rushinga, Hon Tendai Nyabani who had enquired if it was possible for Cotton farmers to be reimbursed at the same time as farmers that delivered grain to the Grain Marketing Board. Government previously held a 30 percent stake in GMB.
Earlier in the Q&A session, Uzumba MP Hon Simba Mudarikwa had revealed that some farmers from his constituency had not been paid for their cotton deliveries.
“We have shares in COTTCO, so let us use COTTCO to buy the cotton. COTTCO is experiencing financial challenges and quite a number of other challenges. Government in the past month has increased their shareholding in COTTCO from 51% onwards. This means that Government will now be able to investigate how COTTCO operates like we do with GMB which is a government entity. However, Government has taken it upon itself to assist farmers and ensure that they are paid,” he said.
Minister Masuka said government had taken upon itself to help reimburse farmers, while an increased stake in Cottco would see increased transparency in its operations.
“The Reserve Bank has already supported the cotton industry through guarantees and they should be getting $5 billion so that they are able to buy cotton. They have been supported through a guarantee of US$10 million for them to be able to get foreign currency so that those who take their cotton can be paid a certain percentage in forex and some percentage in RTGS.
“As we buy cotton, it is different from the way we buy maize and traditional grains. With GMB, we can sell these products to other farmers and to other countries and we get funding but with cotton, it has to be taken to the ginnery and then after that it is sold. It takes time to realise returns from cotton. I have taken up all that has been said. The Government has now increased its shareholding to 51% in COTTCO so that it has control over this cotton company and will show transparency,” he said.
