HomeOpinionCeteris Paribus:Take-aways from Zim’s agriculture

Ceteris Paribus:Take-aways from Zim’s agriculture

EBEN MABUNDA
ZIMBABWE is a landlocked southern African country with a total land area of over 39 million hectares, with 85,4% of the hectares used for agricultural purposes. The remainder has been reserved for national parks, wildlife and urban settlements.

Agriculture is the heart-beat of Zimbabwe’s economy providing employment and income for 60-70% of the population. The sector traditionally supplies 60% of the raw materials required by the industrial sector and contributes 40% of the nation’s aggregate export earnings.

Since 1965, agriculture has contributed an average of 15% to the nation’s GDP with a high of 22% in 1967 and a low of 7% in the historic severe drought year of 1992. In the aftermath of the Fast-Track Land Reform Programme in the early 2000s, the nation’s agriculture suffered from a lack of mechanisation and expertise, resulting in Zimbabwe shrinking into a basket case.

The 2018 agricultural contribution to GDP came in at a meagre 5,07%, a year in which the national GDP grew by a mere 2%. According to the Agriculture ministry, “owing to the low productivity and production, the country has become a perennial net importer of cereal grains amounting to US$800 million annually.”

Meanwhile, the agricultural sector is responsible for feeding the nation and providing livelihoods to 67% of the country’s population in rural areas and is also pivotal in enhancing the recovery and growth of the economy.  However, food insecurity has been consistently growing across the nation. Between 2015 and 2020, the proportion of food insecurity in Zimbabwe’s rural population ranged between 30% and 59%, while urban vulnerability was also on the rise reaching 30% or 2,2 million people by 2020. Furthermore, the proportion of chronically food-insecure people in rural and urban communities surged from approximately 500 000 people in 2015 to about 1,7 million people in 2020.

The National Development Strategy 1 seeks to improve food self-sufficiency and to retain the country’s regional breadbasket status. The thrust of this blueprint is to increase food self-sufficiency from the current level of 45% to 100% in the medium term and reduce food insecurity from the current peak of 59% in 2020 to less than 10% by 2025.

In 2020, agriculture, forestry, and fishing, value added GDP in Zimbabwe was reported at 7,6071 %, according to the World Bank data. The agriculture sector is one of the key sectors expected to anchor economic growth of over 5% per annum for the next five years through resolving the security of tenure on the land to attract investment. The sector is envisaged to attain a constant annual growth rate of over 8% between 2021 and 2025. In addition, the Agriculture ministry has laid plans to realise a US$8,2 billion Agriculture economy by 2025.

As such, the government has tabled a raft of plans that are meant to revolutionise the delivery of the local agricultural sector. These include resolving the security of land tenure, the transformation of Agribank into a land bank, strengthening the use of PPPs, as well as reviewing the contract farming and agricultural marketing frameworks. Also, to upscale and expedite irrigation rehabilitation and expansion programmes utilising existing as well as new water bodies, climate smart agriculture and implementation of a commodity value chain Financing Model and speeding up of mechanisation facilities are expected to anchor the US8,2 billion agriculture industry by 2025.

Last year, the government was bullish about the country’s economic growth prospects with a GDP growth projection of 7,8% pinned on the firm global metal prices as well as on the back of a favourable 2020/21 rain season.

On climate issues, there is no guarantee that the 2021/22 farming season will be better than that of the previous season. A decrease in agricultural produce in addition to lower global metal prices will have the effect of shrinking the country’s export receipts.

Mabunda is a Financial Analyst and Business Anchor with Equity Axis, a leading Financial Research Firm in Zimbabwe. Twitter: @EbenMabunda.

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