Nqobile Bhebhe
Zimbabwe’s horticulture sector, once a beacon of agricultural excellence in Southern Africa, has raised deep concern over the reduction of foreign currency retention level from 75 percent to 70 percent by the Reserve Bank of Zimbabwe.
In his 2025 Monetary Policy Statement (MPS) recently, RBZ governor Dr John Mushayavanhu, reduced the foreign currency retention level from 75 percent to 70 percent, with immediate effect.
Exporters had been advocating for 100 percent retention, stating that high export surrender requirements made it difficult to access foreign currency for critical expenditure and financing operations.
“In order to guarantee continued stability in the interbank foreign exchange market through augmenting the supply of foreign currency, as well as building the critical foreign currency reserves needed to anchor the ZiG (Zimbabwe Gold), the foreign currency retention level for exporters has been reduced from 75 percent to 70 percent, with immediate effect,” Dr Mushayavanhu said.
Linda Nielsen, CEO, Horticultural Development Council, said the policy shift presents significant challenges for Zimbabwe’s horticulture sector, which relies heavily on foreign earnings to sustain production, invest in growth, and maintain competitiveness in global markets.
On Monday Nielsen said the horticulture industry operates within tight cost margins, with most inputs-such as power, fuel, seed, fertilisers, packaging, and freight-denominated in US dollars.
“The reduction in forex retention means exporters will have less hard currency to meet these critical expenses, placing strain on cash flow and investment in the sector.
“Producers of export-oriented crops such as peas, which have high production and logistics costs, may be forced to scale back operations.
“Some farmers may pivot to alternative crops and shift focus to local cash markets, which do not provide the same foreign currency inflows or long-term economic benefits as exports,” she noted.
The association urged policymakers to engage with the sector to explore solutions that balance the need for foreign currency reserves with the long-term sustainability of Zimbabwe’s horticulture industry.
“Ensuring a stable and predictable policy environment is critical to maintaining Zimbabwe’s position as a key player in regional and global horticulture markets,” she said.
