Zimbabwe's cooking oil producers and the country's central bank governor appear to be at odds over whether foreign currency and letters of credit (L/Cs) are available for the raw materials the manufacturers need.

Cooking oil producers say they cannot obtain foreign currency to make external payments and have written to the Reserve Bank of Zimbabwe (RBZ) enquiring about the bank's plans to help the industry clear outstanding debts as well as access foreign currency for key inputs.

Material shortages

Industry players have told local media that the majority of cooking oil producers have run out of raw materials that include crude soya beans and palm fats.

But RBZ governor John Mangudya said cooking oil producers should be able to obtain foreign currency and L/Cs from the interbank market. "These people know what they must do. They may be misrepresenting facts. Isn't it that they have been drawing down L/Cs from Afreximbank," he says.

Afreximbank support

In February, the African Export Import Bank (Afreximbank) said it would provide a revolving US$255 million L/C facility to Zimbabwe for imports of critical raw materials for the production of edible oils, fuel, fertilisers and pharmaceuticals.

But the edible oil producers claim that no firms have recently been able to obtain L/Cs to import key inputs.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.