Private sector key in agricultural transformation

02 Apr, 2023 - 00:04 0 Views
Private sector key in agricultural transformation

The Sunday Mail

Word from Market with Cliff Chiduku

GOVERNMENT initially targeted to transform agriculture into a US$8,2 billion sector by 2025, which it has since surpassed.

The sector is expected to contribute at least 20 percent to the gross domestic product (GDP) in that period, from the current 17 percent.

Agriculture is a key pillar and enabler of the country’s economic development and is the main source of livelihood for around 70 percent of the population.

The private sector’s contribution to agricultural transformation is key.

The Government’s dream to achieve an upper middle-income economy by 2030 is anchored in agricultural transformation, among other economic activities, hence the sector is set to play an important role.

This means the country should be food and nutrition secure.

The agriculture sector’s contribution to Vision 2030 is rooted in various blueprints such as the Agriculture Recovery Plan, the Livestock Recovery and Growth Plan, the Horticulture Recovery and Growth Plan, and the Accelerated Irrigation Rehabilitation and Development Plan.

These plans are aimed at engendering a sustainable and inclusive agricultural transformation to achieve food and nutrition security, import substitution, value addition, employment creation, diversified exports and improved household incomes and living standards.

The dream is fast becoming a reality, thanks to various Government interventions.

Owing to limited resources and competing commitments, the Second Republic deliberately adopted a multi-sectoral approach to transform agriculture.

Of note is the opening up of agriculture to the private sector through public-private partnerships (PPPs). Zimbabwe is, indeed, open for business. By nature, PPPs are long-term arrangements between Government or its agents and private sector organisations.

Typically, they involve private capital financing Government projects and services upfront, and then drawing revenues from taxpayers and/or users over the course of the contract.  PPPs have been widely used for infrastructure development but have now become an increasingly popular method of delivering public goods and services.

The agriculture sector is facing the challenge of providing enough food, feed and raw materials to meet the growing population and changing demand.

This calls for the development of innovations to enhance productivity and sustainability along the supply chain, while helping the sector to cope with climate change issues.

Cooperation between various public and private actors is key to improving the efficiency with which public funds are used.

Private players have chipped in with technical expertise and financing through contract farming arrangements.

According to a 2020 policy pronouncement, all private sector off-takers are required to secure at least 40 percent of their annual raw material requirements from the domestic market by supporting local farmers through contract farming.

One of the key roles of the Agricultural Marketing Authority (AMA) is to promote contract farming arrangements.

This is done through the provision of an enabling regulatory environment that seeks to balance the interests of private sector investment and farmers.

For the 2022/2023 season, maize recorded the highest number of registered contractors, boasting a 78 percent share, followed by soya bean.

The current drive is to promote value chains for crops such as sunflower, sesame seed and sugar beans.

AMA chief executive officer Mr Clever Isaya believes private sector players are key in agricultural transformation.

Contract farming also reduces transaction costs of accessing markets, borrowing and inputs.

With the country facing liquidity challenges, taking the contract farming route is a viable option for serious farmers, who might be unable to fund their operations using their savings.

The bumper harvest expected this year is testimony to various interventions and investments made by the Government and its private partners in agriculture.

Last year, the country registered a record wheat harvest of 380 000 tonnes, 20 000 tonnes above what is consumed locally.

This bumper harvest is attributed to collective efforts by farmers, financial institutions, the private sector and the Government, which has put forward policies and strategies to attain flour and wheat self-sufficiency in response to global crises.

Like other African countries, Zimbabwe has for decades relied on imports to offset low local production.


Word from the Market is a column produced by the Agricultural Marketing Authority to promote market-driven production. Feedback: [email protected] or WhatsApp/Call +263781706212


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