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Suspension of maize meal, flour duty unsettles local millers

by Staff reporter
28 May 2020 at 07:37hrs | Views
THE Small and Medium Millers Association of Zimbabwe (SMMAZ) says the suspension of customs duty on imported wheat flour and maize meal would cripple production and viability of the local milling industry.

In terms of the regulations gazetted this week by Finance and Economic Development Minister Professor Mthuli Ncube, the Government suspended customs duty on maize meal and wheat flour for six months from May 22 to November 21, 2020.

Statutory Instrument 219 gives details of the three tariff items of suspended duty for bags of wheat flour of 50kg or more, smaller packs of wheat flour and maize meal. A second statutory instrument had already split the tariff item that covered both maize groats and maize meal so the meal duty could be suspended without simultaneously suspending the maize groats duty.

SMMAZ interim chairman Mr Davis Muhambi told Business Chronicle yesterday that as an association they were unhappy with the duty pronouncement by Government.

"We are actually drafting a letter to the ministry and the Ministers of Finance and Industry and Commerce decrying that pronouncement.

"It's good to remove customs duty on the importation of maize, anyone can import we have got no problem because the maize will still be required to be value added and industry will play a part.

"But on finished maize meal and flour, we think it should be the preserve of the miller to import because if anyone is allowed to import such finished products, the millers stand to lose yet they have invested in the milling sector to keep the employees paid," he said.

Mr Muhambi said if the importation of maize meal and wheat flour is made a preserve of the milling industry, it promotes a culture of balancing between imports and local production and thus saving jobs in the sector.

"By so doing, it encourages self-regulation mechanism that will balance imports and local production otherwise imports will outweigh production and destroy the industry, which we will need in the posterity," he said. The precedence has already been set in this country, for example, in the dairy processing sector, not anyone is allowed to import powdered milk, said Mr Muhambi.

"And when you have invested and supported local industry and agriculture, are you then allowed to benefit from the importation," he said, adding that SMMAZ was calling upon Government to revisit the decision and allow the importation to be a preserve of the milling industry saying the sector already has got the infrastructure and network to distribute the product.

"They (Government) should incentivise investments in the milling sector to boost production and create more jobs in the sector," said Mr Muhambi.

Zimbabwe requires about 1,8 million tonnes per year and due to poor harvest last cropping season, Government is importing to cover the deficit.

Last year, the Government announced that individuals and corporates were now allowed to import grain using their own free funds.

Source - chronicle