Thupeyo Muleya
FARMING is the mainstay of most families’ livelihoods especially those who grow cash crops.

The government’s land reform programme at the turn of the century was a turning point for most black farmers who decided to try their luck in tobacco farming, a field which was formerly dominated by white commercial farmers.

A total of 100,000 farmers registered to grow tobacco in 2014, an increase from 88,837 in 2013.

Furthermore in 2014 Zimbabwe spent $269,3 million on tobacco imports to blend with the local flavours.

China, Belgium and South Africa are the biggest importers of Zimbabwe’s tobacco followed by United Arab Emirates, Indonesia, Brazil, United Kingdom, Singapore, Germany, Cambodia, Japan, Zambia, Lesotho, Malawi, Poland and Switzerland.

The demand for Zimbabwe’s tobacco and related products by other countries has seen the establishment of well orchestrated syndicates who facilitate the illegal trade and smuggling of the golden leaf into various countries.

South Africa has become one of the major destinations where mostly cigarettes are smuggled through Beitbridge Border Post or illegal crossing points along the Limpopo River.

Almost 30 percent of the cigarettes on the South African market are from Zimbabwe. It is also difficult for Zimbabwe to export cigarettes to South Africa because of the high excise duty in that country on tobacco or cigarettes.

Globally, cigarette smuggling has been a phenomenon which has seen the former British Chancellor of the Exchequer and Global Vice Chairman of British American Tobacco (BAT), Kenneth Clarke, admit before the British parliament that BAT was annually involved in £5 billion of cigarette smuggling globally.

More recent stories in South African media paint a picture of Big Tobacco as a vicious corporate cabal that uses its considerable financial muscle to subvert governments, control national security apparatus, and spy on, disrupt and destroy any competitor.

Savanna Tobacco’s Head of marketing Gerald Gumbo said trade in cigarettes and related tobacco products was unfair regionally owing to escalating industrial espionage.

He said the notion that any cigarettes produced by any competitor to Big Tobacco are smuggled or illicit is meant to shift attention from the real perpetrators of smuggling and to hinder Zimbabwe’s attempts at taking control of its number one export crop, its beneficiation, and its downstream value.

“This is the same approach used with Zimbabwe’s diamonds, which suddenly became ‘blood diamonds’”, he added.

Gumbo said the sabotage has seen some companies engaging people to spy on other companies’ operations adding that in some instances customers were being harassed or arrested soon after buying cigarettes from local companies on suspicion of being smugglers.

He said the motive of the anti-cigarette lobbying groups in the country was questionable and affecting the growth of manufacturing industry and economy.

“Tobacco is Zimbabwe’s most important crop, bringing into the economy $600 million every year and when our cigarette manufacturing industry reaches its sales and exports potential, this amount increases ten-fold to $6,5billion. This is even before we quantify the multiplier effect on downstream employment creation and empowerment,” he said.

Gumbo said the government and other progressive minds should look into ways of creating an even ground in terms of trading of finished tobacco products.

Gumbo said the government could employ the Dubai model where cigarettes producers were exporting them freely without any hassles on the buyers or tracing of destinations of the products after payment has been made.

“Dubai produces 17 times the number of cigarettes annually that we (Zimbabwe) produce without even producing one leaf of tobacco.

Incidentally, the key provider of the cut-rag (the major component for cigarettes manufacturing) is a Zimbabwean,” Gumbo said.

An official with the Ferret Team said the way South Africa was behaving in terms of tobacco and cigarettes trade with Zimbabwe was tantamount to bullying and was against the indigenisation and beneficiation ideologies.

The Ferret Team is made up of border authorities including immigration, Zimra, police and other security agents.

“They’ve double standards. They didn’t ban the imports on raw tobacco from Zimbabwe which they then repackage and rebrand as theirs after which they realise maximum benefits. It’s easy to export semi-processed and cut rag tobacco to South Africa than the finished product.

“You’ll note that Zimbabwe and most countries in Sadc region now resemble South Africa’s supermarket and yet our neighbour is not willing to level the trading field. The high customs duty rates charged by South African Revenue Services (Sars) on tobacco and cigarettes imports have resulted in an increase in cases of tobacco smuggling.

“Our government needs to do more to ensure that we’ve a level trading field with South Africa,” said the official.

He said a kilogram of raw tobacco is bought for $1,80 in Zimbabwe and sold for $25 in South Africa where 30 percent of the cigarettes on the market are from Zimbabwe.

According to British American Tobacco (BAT) Zimbabwe spokesperson Shingai Koti, there is no customs or excise duty on raw tobacco coming from Zimbabwe into South Africa.

“Similarly, there is no customs duty on cigarettes being exported from Zimbabwe into South Africa. However, excise duty is levied at the rate of R12,42 per pack of 20s and R6,21 per pack of 10s for cigarettes exported from Zimbabwe into South Africa” she said.

Koti said the possible solutions to cigarette smuggling between Zimbabwe and South Africa’s borders would need collaborative efforts of various law enforcement agencies, including Customs and Revenue Authorities, treasury, trade and defence departments.

“We encourage both the Zimbabwean and South African governments to raise collaborative initiatives with Sadc member states to tackle the illegal flows of product across and into the region, and specifically the variance in import and export declarations.

“We also support the Framework Convention on Tobacco Control’s Protocol to Eliminate Illicit Trade in Tobacco Products, which has been ratified by only two countries in Southern Africa — Botswana and South Africa,” said Koti.

“We encourage all governments in the region to demonstrate their commitment to addressing the issue by ratifying the protocol and instituting its measures to address the issue. This treaty will be more effective if it is consistently applied and enforced by joined up governments”.

South Africa charges customs duty of around 150 percent on cigarettes from Zimbabwe. For instance in the case where one buys a consignment worth R10,000 from Zimbabwe they will need to pay import duty of R15,000 to Sars.

Sars spokesperson, Luther Lebelo said the import duty charged on tobacco was determined by various treaties relating to imports from Sadc countries which could affect duty on goods.

He said a total 82,689,043kg of tobacco was imported from Zimbabwe between January 2010 and March 2015. These include imports of cigars, cheroots, cigarillos and cigarettes.

He said they had various strategies to curb smuggling within their borders.

“If cigarettes come through in concealed consignments at the port of entry, customs target these through use of the Sars detector dog unit (with dogs specifically trained to detect tobacco).

“Customs inspectors also do random and targeted inspections based on intelligence from our Risk Engine. We’ll also during the year make use of a new cargo scanner which will be introduced at Beitbridge. Currently Zimbabwe Customs also make use of a cargo scanner.

“Furthermore the South African defence Forces (SANDF) are constantly patrolling the entire border” he said.

Andrew Matibiri, the chief executive officer of the Tobacco Industry and Marketing Board said it was important for the government to engage South Africa over the fair trade of tobacco and related products.

“We must add value to our products before exporting to other countries including SA. Those companies that import Zimbabwean cigarettes should come and set up manufacturing plants here. This way we’ll reduce smuggling, increase employment creation and also add value to these products. The government needs to engage its counterparts on making common arrangements which will ensure a fair trading environment.”