By Elijah Chihota
The Zimbabwean economy is agro-based driven by both animal and crop husbandry which in turn promote the rest of industry. Agriculture employs around 70 percent of the population and 60 percent of industrial raw materials come from this sector. It contributes 14 percent of the Gross Domestic Product (GDP) and accounts for 45 percent of the country’s exports.
The agricultural sector produces maize, wheat, barley, soya bean, tea, coffee, poultry, dairy, beef, mutton and honey among others. It is these crops/produce which when processed can make downstream industries start to operate at a higher level. However, this is not exactly what is happening on the ground due to lack of financial resources, equipment, lack of market information and technical knowhow.
ZimTrade revealed that Zimbabwe was losing potential revenue from the export of sweet potatoes to the European Union, (EU). The country has not exported sweet potatoes to the EU since 2012. The European market is worth US$216 million as of 2016.
The country had been exporting beef to the EU under a quota system for a long time and that ceased following the illegal sanctions imposed on the country by this bloc. Another area of interest was the horticultural sector covering crops such as flowers, vegetables and citrus fruits which was earning the country an excess of US$27 703 307 in 2007.
Today, the Hwange Colliery Company’s production levels have gone down amid low demand for coal by industry and farmers, the National Railways of Zimbabwe (NRZ) is not operating at full capacity given that feeder industries and subsectors are not fully utilising their capacity.
Given the above developments, there is still hope for the country to turn around the economy hinging on the agricultural sector as its backbone. What it takes is to have all players availing their resources for maximum production of food first then stimulate downstream industries and the circle goes on until all sectors come on board. These economic players include financial institutions, seed houses, inputs suppliers and farming implements merchants.
Farmers were struggling to harvest meaningful yields, save for the 2016/17 farming season when government rolled out the Command Agriculture Programme. Therefore, the banking fraternity could come up with a viable funding model which is within the reach of farmers. They may increase the repayment period at the same time hedging them against inflation. For example, the People’s Own Savings Bank (POSB) has introduced the Agribusiness Account. The institution’s decision indicates that it realised a funding gap in the agricultural sector and stepped in to close it. Agribank, CBZ Bank, ZB Bank and FBC Bank which all have agribusiness divisions could also follow suit and fund farmers after assessing farmers’ needs case by case, basing on merits.
Farmers are in need of farming implements which are currently highly priced beyond the reach of many. Service providers such as Bain New Holland, Massey Ferguson, John Deere and Case’s local agents may come up with payment plans which allow farmers to purchase the equipment at affordable terms. This would enable farmers to use the equipment to produce various crops at the same time making regular payments. Given the prevailing liquidity crunch, very few farmers can afford to fork out hard cash to buy farm implements. As a result, suppliers are holding on to their products while farmers are failing to plant meaningful hectarage of their land.
Alternatively, equipment suppliers could form tillage units which offer tillage services to farms. This model calls for a win-win situation where farmers would plant in time while suppliers would increase their revenue streams rather than waiting for the harvest time to sell one or two units. This would be modelled along the District Development Fund (DDF)’s Tillage Unit.
Climate change has ushered in erratic rainfall which in most cases is not enough to support crop growth in one full season. Therefore, investment in irrigation development is essential. In that regard, a Managing Director of a local seed company, Denis Zaranyika, was of the opinion that government could finance irrigation development at farms and allow farmers to harvest maximum yields:
“Irrigation is needed to supplement rain water to raise crops in the dry part of the season. Given the unpredictability of weather patterns owing to climate change, it is important that as a country we make significant investments in irrigation facilities,” said Zaranyika.
Seed houses and fertiliser companies also have a role to play where they can come up with a full package of inputs for farmers ahead of each farming season. In order to recoup their expenses, the inputs providers could use the stop order forms so that they get their dues when farmers deliver their grain to the Grain Marketing Board, (GMB). It therefore, calls for strict monitoring on the part of the Agricultural Marketing Authority (AMA) to ensure that there is no side marketing of produce.
Coal plays a critical role in tobacco curing and of late farmers had to resort to the use of firewood as the Hwange Colliery Company was not able to meet demand. Therefore, coal miners could also open coal depots in tobacco growing areas so that it is readily available when farmers want it. In line with the decentralisation of tobacco auction floors, the same could happen to these players. This would have long term benefits in that farmers would no longer cut trees for tobacco curing as coal would be locally available.
Disclaimer: The views expressed in this article are those of the writer and do not necessarily represent the Zimbabwe Broadcasting Corporation.