FINANCE minister Patrick Chinamasa says the government will maintain the $390 per tonne maize price in the 2017/2018 agricultural season, despite it being the highest in Southern Africa amid concerns that it is unsustainable.

By Fidelity Mhlanga

Finance minister Patrick Chinamasa

Critics claim the high producer price offers opportunities for arbitrage, where opportunists would buy grain from neighbouring countries, where it is 50% cheaper and sell at the Grain Marketing Board (GMB), but Chinamasa stuck to his guns, insisting the high price was similar to a subsidy.

“You are quite right about raising opportunities for arbitrage, but we had to put in measures so that we minimise any opportunities for arbitrage,” he told delegates at the Institute of Chartered Accountants of Zimbabwe winter school in Victoria Falls last week.

“As we go forward, I promise, basically, the $390 per tonne for maize will be maintained for the current and for the 2017/2018 agricultural season, but we may need to start a debate on forms of subsidies.”

The country is expecting a harvest of 2,1 million tonnes of maize for the 2016/2017 agriculture season buoyed by favourable rainfall.

Last week Chinamasa indicated in the 2016 Annual Budget review and 2017 outlook that starting with the 2017/18 agricultural season, “command maize”, “command wheat”, “command livestock”, “command fisheries” and “command wildlife” will be unveiled at a total cost of $334 million.

This comes as the International Monetary Fund (IMF) has said the design of the command agriculture “programme creates significant fiscal risks”.

Chinamasa said the command programmes will be complemented by the presidential input scheme, which will cost $153,1 million to cater for about 1,8 million rural vulnerable households.

Meanwhile, Chinamasa said for the country to record meaningful growth, it has to adopt a local currency.

“There is need to build reserves,” he said.

“Ultimately, after building reserves, you need to start worrying about introducing your own currency.

“I think the governor (Reserve Bank of Zimbabwe boss, John Mangudya) mentioned very clear that you cannot expect growth when your medium of exchange is a reserve currency, which in any case has so many leakages such that you are not keeping it.

“We made it clear that eventually, if we are to achieve meaningful growth, we need to get a weak currency of our own. But when that will be will depend on arriving on various milestones up to the destination, “he said.

Chinamasa said Zimbabwe has lost time and needs to catch up, revealing he wants the country to achieve economic growth of between 7-10% in the next 15 years.

Chinamasa said in him and Mangudya, the economy was in the right hands.