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In a Monetary Policy Statement issued by government on Monday, the tourism industry is among sectors identified to retain their foreign currency earnings to allow for recapitalisation.
Export Retention for Tourism and Hospitality Industry
“In order to respond to the adverse effects of COVID-19 on the tourism sector, which was hard-hit by the pandemic not only in Zimbabwe but the world over, with immediate effect, players in the tourism and hospitality industry shall retain 100% of their foreign currency earnings to allow them to quickly recapitalise and procure the necessary goods and services required by tourists and travellers.” said Dr John Panonetsa Mangundya, the Reserve Bank of Zimbabwe (RBZ) Governor.
Export Retention for Manufacturing, Horticulture and Cross-Border Transport
On account of the high import requirements embedded in the manufacturing, horticulture, and cross-border transport sub-sectors of the economy, with immediate effect, exporters in the manufacturing, horticulture, and cross-border transport sub-sectors shall be eligible to retain 100% of the incremental portion of their export receipts, the Governor said.
The export base for these sub-sectors has also been refined to incorporate their high import requirements.
Export Retention for Tobacco and Cotton Growers
Governor Mangudya said the financing models for tobacco and cotton require a refinement of the export retention threshold to increase participation by small-scale growers and to boost tobacco and cotton production in the country. Accordingly, the retention threshold for tobacco and cotton growers shall be increased to 75% for the forthcoming tobacco and cotton marketing seasons. The funds retained by the growers shall continue to be treated as free funds.
Incremental Export Retention for Tobacco Merchants
Dr. Mangudya added that tobacco merchants will retain 80% on the portion of the incremental value addition repatriated into the country and 100% of proceeds from local sales of tobacco through inter-merchant sales.