Zambia’s crocodile industry faces imminent closure as the imposition of a 10 percent export duty takes its toll, the country’s producers association has said.
In a statement, the Zambian Crocodile Farmers Association (ZCFA) said local crocodile skins were prized the world over for high-end footwear, handbags and garments, but now some US$1.3 million worth of skins were sitting in cold storage because farmers could not raise the up-front money to pay the tax.
Two farming operations were closing, with another two planning to follow.
“The situation is dire,” ZCFA chairman Johann Jordan said.
“Farmers need this revenue from sales to run their farms, and the nation needs the foreign exchange we generate from these exports, but this tax is on the verge of killing the industry.”
Since the export duty was introduced in January, crocodile farmers have paid US$350,000 on skins exported, sucking out all the liquidity from the industry, Jordan said.
He said operations were being wound down with virtually no egg incubation this year, just as the industry was finding its feet again after a tightening of grading standards that prompted a change in growing methods, stocking densities, chemicals and food formulation in recent years.
In 2018, Zambia exported about 31,685 farmed crocodile skins, but projections show this will slide by almost a third to 22,000 this year, half of what was exported in 2015.
“There are more than 600 jobs at risk, mainly in rural areas. Bearing in mind that it takes about four years to establish a crocodile farm, the chance of any resurrection of the industry once collapsed, is unlikely,” said Mr Jordan.
He said engagement between the association and the ministry of finance since January had not resulted in the tax being reviewed, despite suggestions that crocodile skins were caught in wider legislation on the export of hides and skins due to an administrative error.
“Crocodile farming is a foreign exchange earner and generates employment. It is an industry that should be attractive for long-term growth and not short-term fiscal gain,” Jordan said.
“The time is now critical for a decision to be made by government if this industry is to survive in Zambia.”