US embassy cable - 03HARARE355

UNCLAS SECTION 01 OF 02 HARARE 000355 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR AF/S AND AF/EX 
NSC FOR SENIOR AFRICA DIRECTOR JFRAZER 
 
E. O. 12958: N/A 
TAGS: EAGR, ECON, ZI 
SUBJECT: Tobacco Buyers Reportedly Fund New Ventures Outside 
of Zimbabwe 
 
Ref:  Harare 338 
 
SENSITIVE BUT UNCLASSIFIED.  NOT FOR INTERNET POSTING. 
 
1. (SBU)  Summary: Dispossessed white commercial farmers 
report that tobacco growers are trying to fund new ventures 
for them in third countries.  Up to 170 tobacco farmers have 
reportedly entered into such start-up schemes. Other farmers 
report that they do not want to continue farming in 
Zimbabwe, but they have not decided whether they would 
pioneer in another country.  End Summary. 
 
2. (SBU)  In a recent meeting with the Commercial Farmers 
Union (CFU), president Colin Cloete reported that "Big 
Tobacco" (he declined to identify who this actually is, but 
it appears to be tobacco buyers) is apparently financing new 
start-up programs for Zimbabwean tobacco farmers in third 
countries, particularly Zambia.  According to Cloete, some 
tobacco buyers who need the flue-cured flavor tobacco 
traditionally produced by Zim commercial farmers have opted 
to fund production of the product rather than either:  a) 
change their long-standing blend, or b) hold out hopes for 
an adequate, if reduced, yield -- including smaller-leaved, 
less well-cured, and less valuable product -- from Zimbabwe. 
Tobacco buyers want the specific product and don't really 
want to be held hostage to the questionable success of 
Zimbabwe's agricultural reform. 
 
3. (SBU) According to Cloete, tobacco buyers have offered to 
completely fund the start-up costs for approximately 300 
established producers on new land in third countries,  with 
pay-back times ranging from five to seven years.  Up to 170 
farmers have reportedly taken up such offers.  Cloete 
himself noted that he is a farmer, not a pioneer nor a 
politician, and he would prefer (all things being equal) to 
continue exercising his skill in Zimbabwe -- a sentiment 
likely to prevail among third- and fourth-generation 
farmers.  Most commercial tobacco farmers are in the 
position of trying to salvage anything they can from their 
lifelong investments, and some continue to farm in Zimbabwe 
despite the likelihood they will lose their farms before 
harvest.  Many of the tobacco farmers still operational are 
fighting acquisition in court and/or struggling to fend off 
land grabs, whether legal or extra-legal.   If (when) it 
becomes apparent to some of the farmers who are still trying 
to produce a crop that they will be wiped off the land, they 
may well give in and accept a tobacco-buyer-funded start-up 
elsewhere. 
 
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Why Some Farmers Are Taking Up the Offers 
----------------------------------------- 
 
4. (SBU)  Other farmers have given up all hope of a return 
to normalcy and business as usual in the country of their 
birth.  One forty-five year old commercial tobacco farmer 
reported that, even though he is at the prime of his life as 
it relates to farming -- relatively young, healthy, and 
possessing a wealth of specialized experience -- he does not 
want to continue farming in Zimbabwe.  He pointed out that 
tobacco, in particular, is a labor-intensive crop that 
depends on the trust and cooperation between the farmer and 
his labor force.  Although like many commercial farmers he 
zealously attempted to protect his relationship with his 
workers, under pressure from war vets and the influence of 
Joseph Chinotimba's rogue "labor union," this farmer's labor 
force "turned" against him to the point that his former 
laborers participated in the occupation and looting of his 
farm. 
 
5. (SBU)  This particular farmer's land was purchased in 
1999 after it was turned down by the GOZ, and has never 
received a Section 8, or Final Notice of Acquisition; 
because of repeated harassment, the family moved into town 
for its own safety.   When his wife returned to the farm to 
check on horses that had been left under the care of some 
trusted former workers, she was assaulted and beaten -- 
along with her 17-year-old son and his friend, while her 11- 
year-old daughter watched in a state of shock -- by a group 
led by the politically-connected Zanu-PF beneficiary Themba 
Mliswa, who is "claiming" their farm as a "new commercial 
farmer."  How, this man wearily asked, could he again trust 
farm laborers who looted his property and then stood by, 
refusing to help, while his wife and son were being beaten 
by thugs in front of them? 
 
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Comment 
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6. (SBU)  In sum, tobacco buyers are apolitical -- they are 
trying to ensure their continuing access to a specific 
ingredient, and much of that access depends upon the skill 
of the growers.  If Zimbabwe's production does not meet the 
buyers' needs, the buyers have no qualms about dropping 
Zimbabwe in favor of a more controlled supply.  This new 
venture may also indicate a desire by the buyers to move 
away from an auction-type model -- which would increase both 
freedom and income for the farmer, if the skewed economic 
policies at play in Zimbabwe were eliminated -- to a 
"captive-grower" model whereby the buyers would face less 
uncertainty and less competition for the final product.  In 
any case, such a move underscores the fact that tobacco 
buyers know that expertise is crucial to produce the 
valuable product that they want -- it takes more than an 
interchangeable peasant farmer with a hoe.  In the end, 
commercial farmers who decide that continuing to farm is 
their best survival strategy may well find the security 
offered by tobacco buyers to be more seductive than the 
"freedom" - and concommitant risks - which a kinder and 
gentler Zimbabwe previously offered. 
 
7. (SBU)  As we have pointed out, however (reftel), once 
these farmers go, the GOZ loses a potential resource vital 
for rebuilding the shattered economy -- and must further 
contend with a costly compensation claim hanging over its 
head.  End comment.