Agriculture Reference
In-Depth Information
2000-2008 case represents an abnormal situation, it remains important in calling attention
to the consequences of bad policy on markets and welfare of the people. By 2009, Zimbabwe
witnessed an adoption of multiple currencies (US dollar and the South African Rand) in
the economy as a way to curb hyperinflation and price stabilisation. This had a positive
effect since inflation dropped from 2.31 million per cent, in July 2008 (GOZ, 2009) to -3%
after the dollarisation of the economy in the first quarter of 2009.
Land redistribution in Zimbabwe led to a wide dispersion of people in rural areas as farmers
occupied land in former cattle ranches. Since 2004, Mwenezi District had its GMB depot
relocated from Sarahuru business centre in the old communal area to Rutenga Business
Centre in the former large scale commercial area. Though such a move was believed to be
politically motivated, it could be justified by the location of Rutenga Business Center at a
well serviced location along the Beitbridge-Harare highway, together with a rail network
that links the district to main towns like Bulawayo, Chiredzi and Beitbridge as well as
direct link to Mozambique, Botswana and South Africa. Such links are important to a
district like Mwenezi that has always benefited from food acquired from outside the district
boundaries. The issue of high transactions costs, which is normally associated with poor
road infrastructure, poor information flow and the role of middlemen in agricultural
product marketing, was partly addressed by the relocation of the Grain Marketing Board
(GMB). The current GMB location is however too far for most residents, with most of the
households in the newly resettled areas preferring to acquire their maize from informal
sources (farmer to farmer trading), rather than travelling for long distances to the GMB,
where they were not sure to get the maize.
Another consequence of the FTLRP associated with the emergence of the informal trade in
maize has been on widening the gap between the haves and the have-nots due to differential
access to sources of foreign currency for the non-working population who normally received
remittances from relatives abroad or through cross border trading (FAO, 2009). There is
also the emergence of small scale millers among entrepreneurs with the means to directly
import maize from neighbouring countries, especially South Africa. This development
ensured continuous supply of maize and maize meal on the informal markets. In 2008, a
50 kg bag of maize was being sold by small scale millers for between R300 and R350, which
was more than four times the price of maize on the international market and consequently
out of reach of many consumers.
Farmer to farmer trading also represented another form of informal marketing of maize in
Zimbabwe and specifically Mwenezi district. Due to inflation, cash trading of maize was
limited among farmers except where such transactions were denominated in the South
African rand. To overcome the cash constraint, most farmers preferred barter-trading with
livestock (goats, sheep, cattle, chicken, and donkeys), clothes, household utensils, farm
equipment (ploughs, scotch carts, hoes) or building materials. Such trade was also meant
Search WWH ::
Custom Search