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Tuesday, October 4, 2022
HomeNewsRBZ, Millers At Loggerheads Over Forex Allocation Backlog

RBZ, Millers At Loggerheads Over Forex Allocation Backlog

The Reserve Bank of Zimbabwe and millers under the Grain Millers Association of Zimbabwe (GMAZ) are at loggerheads over foreign currency allocation backlog that has resulted in shortage of bread flour.

As a result of the RBZ struggles to allocate foreign currency to millers for them to purchase wheat, bakeries have since put forward a proposal to sell bread in United States Dollars in order for them to be self-sufficient.

Sources within the milling industry told 263Chat that the bakeries feel selling bread in USD due to the fact that 60 percent of the flour is used for bread while the remaining 40 percent goes for other products such as biscuits.

Bread producers also argue that most of their expenses such as fuel are in USD while they are forced to sell their products in local Zimbabwean Dollars.

RBZ is however reported to be adamant that bread and flour will not be sold in USD because of fear of rapid dollarisation.

This came out at a meeting held on June 17 between senior RBZ officials, bakers and millers which ended in a deadlock.

Principally the central bank expressed concerns that since bread is the most frequently purchased commodity, dollarising it would automatically mean the country has dollarised and unions will push for USD salaries.

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Players in the milling and baking industry have reportedly accused GMAZ chairperson Tafadzwa Musarara for failing to push their agenda.

“We met and agreed that Musarara was supposed to advise authorities that we should commence the sale of flour and bread in USD just as has been done with fuel so that we can be self sufficient however it appears he was sweet talked and came with nothing,” said a source within the milling industry.

“It is now two weeks since that meeting and we have had no movement, we have secured 20 000 tonnes of wheat which is already in the country and can only be released once payment is made,” the source added.

Forex payment backlog is believed to be in excess of US$5 Million.

GMAZ Chairperson Tafadzwa Musarara could not be reached for a comment.

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