To make matters worse, the analysts said there was no specific funding for A2 commercial farmers.
Finance minister Tendai Biti
last week proposed a vote of US$122 million in next year’s national budget, of which $41 million was set aside for the ministry’s capital expenditure, with $11,8 million earmarked for rehabilitation and expansion of 63 irrigation schemes nationwide.
Commercial Farmers Union president Deon Theron said the budget allocation was insufficient for the sector’s needs, particularly when one looks at previous allocations to agriculture.
“The funding is largely inadequate if one considers that the country’s economy is agriculture-based. It will not be enough to restore production to its full potential,” Theron said.
He added that: “Agriculture is capital-intensive and the current liquidity crunch will make it very difficult for commercial farmers to perform at their full capacity.”
“It therefore follows that Treasury could have made more resources available. Without that it is going to be pretty difficult to let agriculture reach its full potential.”
Zimbabwe Farmers Union president Silas Hungwe concurred, saying farmers needed more support if the goal of food security is to be attained.
“The budget allocation is not enough. There are lots of areas that need to be covered in the sector. If not covered the expectation of food security will remain a pipe dream,” Hungwe said.
He added that the manufacturing industry recovery is dependent on the turnaround of the agriculture sector.
“If agriculture is expected to play a major role in the turnaround of the economy it needs a lot of support. Industry can only be revived if farming improves,” Hungwe said.
Agricultural Marketing Authority (AMA) chairman Basil Nyabadza said the budget sent a clear signal that commercial farmers were on their own now and have to look for alternative funding if the sector is to be restored to its former glorified position.
“A2 have been cut loose from the treasury umbilical cord. This marks the birth of the new farmer who took over Mr Jones’ farm. We have now to look at in-house solutions to farmers’ financing needs,” Nyabadza said.
He added that: “As AMA, we have started looking at comprehensive ways of funding agriculture on a permanent basis. Agriculture should look at alternative ways than continued reliance on Treasury. We need a revolving fund outside Treasury to spur agricultural production once more.”
Commercial farmer and Muzarabani South legislator Edward Raradza agreed with Nyabadza. “Agriculture is the backbone of the economy. As such it should have been prioritised as a stimulus to the economy,” he said.
Biti, in his budget statement, alluded to the fact that agriculture funding could not be left in the hands of government alone.
“Government’s capacity to fully provide the resource requirements for the sector on its own is limited and, hence, invited other private sector players to complement its efforts,” Biti said.
In the 2011 financial year, the government has sourced loans from financial institutions for A2 farmers amounting to over US$350 million.
The funding among other things will cater for tobacco production (US$158,9 million), cotton, soya and horticulture will receive a combined US$49,7 million and lending to individual farmers totals US$71,9 million.
Biti however said successful private funding of agriculture would depend on resolving the land tenure question under the agrarian reforms.
“The issue of the security of tenure is critical. Whatever tenure system is chosen, it must surely provide for security, must be registrable, executable and must be transferable,” the minister said.