Japan Tobacco International (JTI) Leaf Malawi has released a total of K581 million to its contracted growers to assist the growers during the lean farming season as well as to cushion them at a time the country is heavily hit by the Covid-19 pandemic and the 2020-2021 tobacco growing season is at its peak.
Collateral Release is a program where JTI Leaf Malawi pays back money it gets from growers at the beginning of the farming season as security for the growers to enter into contract with the company.
In his remarks during a virtual briefing on Wednesday, JTI Leaf Malawi Corporate Affairs and Communications Director Limbani Kakhome said that this money is given back to the growers as collateral release to help the growers with their day to day livelihood needs as well as production costs.
He added that Tobacco production is quite involving, financially and therefore the company feels duty bound to help its growers meet production demands in order to come up with top quality tobacco.
“This is the more reason why for more than four years we have been undertaking this program. We give out the funds between January and February because around this time, there are just many activities that require money.
“Over the years, the quality index of tobacco produced by our growers when compared with quality from other countries has been growing steadily. This is attributed not only to the quality of extension services we provide to growers, but also to other programs like this”, he explained.
According to him, they call the process collateral release considering that every year JTI growers deposit a sum of money as loan security in order to enter into a contract with the company. This money is given back to the growers as collateral release to help the growers with their day to day livelihood needs.
He then said that JTI will continue with the program because it is very important as it helps growers produce the leaf the company looks for.
He said: “Apart from growing tobacco, most of these growers also run small businesses and just as every sector, these small businesses too have been affected by this pandemic. The money we have released, therefore, will mean a lot to these growers far much more than in the past years.”
A total of 8 000 growers have received money through the intitiative.