The Sunday Mail
Government support in agriculture remains the biggest window to boosting farm output, as funding from historical banking institutions proves elusive, according to analysts.
Through interventions such as the Command Agriculture and the Presidential Inputs Scheme, authorities have spent millions of dollars helping both small and large farmers obtain provisions like seed, fertilisers and tractors.
The programmes have largely boosted yields, helping to ease hunger at a time of repeat extreme events and a generally lethargic financial industry.
The Zimbabwe Association of Micro Finance Institutions (ZAMFI) reported that agricultural lending for the last quarter of 2018 declined 9 percent to 14 percent, on the back of perceived risk in agriculture due to the El Nino induced drought and macroeconomic challenges.
In the past few years Zimbabwe has experienced various natural disasters such the El Nino induced drought, Cyclone Idai that hit parts of Manicaland and Masvingo Provinces as well as the fall armyworm outbreak. These have been a threat to agriculture output and food self-sufficiency.
But analysts contend Government support for both food and non-food crops as well as livestock production will remain the anchor for the sector that drives the Zimbabwe economy through employment, food security and 70 percent of raw materials for the manufacturing sector.
“Based on the downfalls presented, we anticipate that the reduction in production will require increased Government support to sustain the sector,” said brokerage firm IH Securities in their 2019 Zimbabwe Agriculture Report.
“Support to the sector has vastly expanded in recent years to an estimated direct fiscal cost of 4,2 percent of GDP in 2018, up from less than 1 percent in 2013.
“The devastating effects of the El Nino induced drought together with the prevailing liquidity crisis has made it imperative for the Government to step up efforts in food security and food self-sufficiency,” said IH.
In response to pests and diseases, Government has raised awareness amongst farmers as well as undertake training activities for extension officers.
The biggest intervention to agriculture sector to support food security has been the Command Agriculture programme, which has surpassed expectations and managed to achieve its intended purpose of boosting food production and meeting local demand.
During the 2017/18 agricultural season, the programme recorded major achievements on the back of better planning and preparedness, coupled with a favourable rainy season and access inputs which were mostly subsidised by the Government.
Despite threats posed by natural disasters like droughts, Government has remained upbeat about the programme which has been expanded to other commodities, apart from grain.
A complementary programme to the initiative is the Command Agro-forestry programme, which focuses on promoting intercropping, where farmers grow fruit trees together with their crops thus improving productivity.
IH sees this as a boost to the sector and economic activity as this is anticipated to increase exports and earn the country the much needed foreign currency among other benefits.
Said IH: “The programme has the potential to transform the livelihood and well-being of local communities by increasing crop yields, diversifying and increasing income, improving soil health and decreasing deforestation.
“Additionally, agro-forestry has the potential to boost fresh fruit exports and reduce foreign currency expenditure which is being channelled towards imports of fruit and fruit juices.”
On the tobacco side, the 2019 marketing season opened on March 20, on a low note as activity was subdued by lower than anticipated prices as well as confusion surrounding exchange rates and currency retention.
Zimbabwe is the largest grower of tobacco in Africa and among the top growers of the golden leaf in the world, producing 3 varieties of the crop.
In a move to support the sector Government removed the 2 percent tax and expressed commitment to pay farmers in US Dollars.
The Reserve Bank of Zimbabwe (RBZ) in conjunction with the Tobacco Industry and Marketing Board (TIMB) announced that it shall ensure that all tobacco growers are entitled to half of their net tobacco sales proceeds into their nostro FCA bank accounts, while the remainder will be transferred to grower’s RTGS$ bank account.
The RBZ has also granted large scale tobacco farmers, growing more than two hectares of tobacco, permission to retain foreign currency earned in their Nostro FCA accounts for a period of 180 days.
Such initiatives by Government and other interventions in livestock, cotton, poultry, sugar cane and fish production are expected to help sustain the sector which feeds into several downstream industries.
