Cotton: AMM welcomes “milestone” government decision – Mozambique

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Cotton: AMM welcomes “milestone” government decision – Mozambique

3:54 CAT | 14 May 2020

File photo: Macauhub

The government’s decision to subsidise the price of seed cotton in the 2019-2020 campaign will increase the amount disbursed to the producers to around 1.1 billion meticais, representing a major boost to rural development.

The acknowledgement comes from the Cotton Association of Mozambique (Associação Algodoeira de Moçambique – AMM), which, in a statement to the press, congratulates President Filipe Nyusi and his government for approving a six meticais per kilogram subsidy.

AMM chairman Francisco Ferreira dos Santos says that the subsidy is not one of consumption, but a stimulus to production and producing families, and therefore constitutes an important milestone in national agrarian and economic policy, and an unmistakable sign of the government’s commitment with agriculture and the rural population.

“In the current context of the global economic crisis caused by the Covid-19 pandemic, in which cotton has been one of the most affected agricultural products, this subsidy will, on the one hand, protect the income of almost one million rural people for whom cotton is an important source of livelihood and, on the other hand, it represents a clear incentive to production and productivity, by increasing the price of cotton compared to the previous campaign, which was 23.3 meticais per kilogram,” the AMM says in a communique.

The association expects that, as a result, producers will be motivated to produce more cotton in the 2020/2021 campaign, possibly resulting in an increase in the value of exports by at least US$12 million.

“The cotton price subsidy is also a recognition of the perseverance and resilience of the entire cotton subsector (producers and companies), which at all times in national history has always remained firmly aligned with the government, always believing that Mozambique has and will have a prosperous future. The cotton subsector has sufficient structure, organisation, stability and maturity to be able to implement an adequate support mechanism for producing families in a very short time and without any additional expense, ensuring that the entire subsidy amount is distributed to beneficiaries without losses and in a direct, fast and efficient way,” the note from the AMM stresses.

According to the same source, a discussion is currently underway between the parties with a view to identifying a mechanism for implementing the subsidy that guarantees maximum security and transparency to the process, with the operators’ foreseeing that commercialisation will start soon.

“A word of thanks to the National Producers Forum (FONPA) and to the Mozambique Cotton Institute (IAM) for their tireless work in this process. We also extend a word of gratitude to all the producers who, with us, have always kept alive the cotton production and the flame of hope,” the AAM concludes.

Source: Noticias