Sunday, May 27, 2018

Command Agriculture requires $1,3 billion

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Livingstone Marufu
Zimbabwe’s main agro-import substitution programme, commonly referred to as Command Agriculture, requires close to $1,3 billion to take off as the country steps up efforts to raise local production and export earnings.
The Government is using this programme as one of its key policies towards reducing an unsustainable import bill, reviving industry and jobs creation.
Already, some agro-based companies listed on the Zimbabwe Stock Exchange, buoyed by the two successful agriculture seasons, have recorded impressive results, thanks mainly to the Government’s support schemes.
Built on a need to balance foreign currency savings and Government spending, the Government is improvising to make the programme profitable.
Buoyed by the command maize success last year, Government has extended Command Agriculture to other crops such as wheat, soyabeans, and rice and livestock to cut the country’s trade deficit to sustainable levels.
According to statistics with the Lands, Agriculture and Rural Resettlement Ministry, command maize production has reportedly used $334 million this year, while command livestock, wildlife and fisheries are expected to use $300 million. Soyabean requires $200 million, wheat production requires $200 million, while horticulture requires $120 million and rice needs $100 million.
It is believed that last year, the country used $600 million on processed food only.
Lands, Agriculture and Rural Resettlement Deputy Minister Davis Marapira said such a situation is unacceptable and should not be repeated in a country that has the best soils and climate for almost every crop.
Command programmes will save $1 billion. Deputy Minister Marapira said: “If Zimbabwe carefully undertakes the aforementioned Command programmes, the country will save up to over $1billion of foreign exchange, thereby cutting the trade deficit to around $900 million from $1, 8 billion.
“If for one season we manage to produce 300 000 of soyabean, we will save $200 million, domestic maize requirements could save us $300 million, while sufficient wheat production will save us $200 million of hard currency, localised rice production can save Zimbabwe up to $150 million while command horticulture will help us to save over $200 million.”
Deputy Minister Marapira reiterated that the increased local production will help the country improve food security, save foreign currency, cut trade deficit and increase capacity utilisation of the manufacturing industry as well as increase exports.
Government has already started import substitution programmes on wheat, livestock and soyabean.
More permits for raw materials, less for finished goods
He said the country will restrict the issuance of permits to companies that are buying finished products to reduce the trade deficit, while issuing more import permits to raw materials buyers.
“We have engaged our Industry, Commerce and Enterprise Ministry counterparts on the issuance of import permits on finished products.
Although we don’t need any shortages of basic commodities in the country, there is need to import more raw materials to increase localised production and employment rather than importing inflation into the country.
“Our local production is currently down and we need to find ways to get it back up. We need to produce locally.
“If we issue import permits recklessly we will be killing ourselves as we use more money on finished products than buying raw materials.
“No new jobs will be created. If we have higher hopes of returning to the bread basket status and recovering the economy, we should leave the importation of finished food stuffs to very few companies,” said Deputy Minister Marapira.
He said organisations should contract more farmers to produce locally.
It is believed that every time permits are issued, the country is exporting jobs and foreign currency to other countries.
Zimbabwe imports 94 percent of its rice and 75 percent of its potatoes from South Africa. Government is moving to produce the crops under the Command Agriculture programme.
Irrigation and mechanisation programmes
There is need to minimise the over-dependence on rain-fed agriculture and start mounting robust irrigation infrastructure to cushion the country against the effects of successive droughts.
So far, the country has spent $61 million on the More Food for Africa irrigation programme, $85 million on dams and $160 million on centre pivots.
However, more still needs to be done to sustain this.
Deputy Minister Marapira said: “The Government is moving towards ensuring every district has up to five areas where there are centre pivots and a string of small irrigation schemes to achieve sustainable Command Agriculture.
“We should also take in mind that livestock farming needs a lot of water, hence there is need for boreholes and tanks to make water available, especially during the dry periods of the year.”
Low interest rates for farmers
Most farmers have become notorious for failing to honour their obligations. This has resulted in a strained relationship between the farmers and lending institutions.
Zimbabwe Commercial Farmers Union (ZCFU) president, Mr Wonder Chabikwa said banks should lower interest rates so that farmers are able to pay back their loans.
“We are sorry about what happened in the past, some farmers could not pay back loans but going forward, banks should give us loans at lower interest rates so that we can repay them.
“Look at the Command programme, over 75 percent of farmers have managed to honour their obligations,” said Mr Chabikwa.
The major beneficiaries of agriculture in Zimbabwe include Agrifoods, Alpha Grain, Agricura, Ariston, Agricon Equipmen, Farmec, Olivine Industries, Pure Oil Industries, Surface Wilmar, CFI Holdings, Cottco Holdings, Baine New Holland, Hippo Valley, National Foods, Colcom, Zimplough and Seed Co, among others.