Evicted white farmers bounce back

Source: Evicted white farmers bounce back – DailyNews Live

Gift Phiri      29 October 2017

HARARE – White Zimbabwean commercial farmers who were driven off their
land during President Robert Mugabe’s controversial land seizures are
coming back through joint venture arrangements and are also producing cash
crops such as tobacco and soya beans mostly under contract farming.

Zimbabwe hogged global headlines in 2000 when supporters of 93-year-old
Mugabe invaded white-owned farms and evicted their owners, often
violently. Mugabe defended the seizures as necessary to right colonial
wrongs.

Some former white farmers now own contracting merchant companies involved
in financing tobacco mainly to small-scale farmers. There are more than 16
companies involved in contract farming financing.

To the extent that small holder farmers are producing tobacco for the
merchants under conditions where they are not able to accumulate capital
and achieve upward mobility, it can be concluded that the farmers are now
disguised workers for the merchants and the former white farmers.

Toendepi Shonhe, a post doctoral research fellow at the Centre for African
Studies at the University of Cape Town concurred, saying former white
farmers have moved up the ladder along the value chain but continue to
control the land through contract farming.

“White monopoly capital, through merchants such as Mashonaland Tobacco
Company, BAT and Chinese capital through Tian Ze now own the means of
production through the financialisation of agricultural production,”
Shonhe told the Daily News on Sunday.

“But small holder farmers involved in tobacco production are also
benefiting and are doing very well. They have been accumulating and buying
assets, building houses in towns and sending children to boarding
schools.”

Zimbabwean farmers sold 168,49 million kg of the nation’s top export
earner tobacco by the end of the season on June 28, 1,32 percent higher,
compared to 169,02 million kg received prior year, official data showed.

Tobacco Industry and Marketing Board (TIMB), which regulates the sector in
Zimbabwe, said new growers increased by  90 percent from 10 025 in 2016 to
19 014 in 2017 while total registration stood at 98579 farmers, a 22
percent increase from last year. Statistics from the industry regulator
showed that farmers had sold tobacco worth $501,20 million, against $475,8
million during the same period last season  at the country’s auctions and
to official tobacco buyers since the selling season started on March 15.

Thousands of mostly small-scale black farmers have taken over production
of the bulk of the crop, once the preserve of white commercial farmers.

Vice President Emmerson Mnangagwa said in a recent public lecture on
Command Agriculture at the Midlands State University in Gweru that black
tobacco farmers “are now producing more of the golden leaf than the white
commercial farmers during the colonial-era regime.”

“When we took the land, taking it back to its rightful owners, tobacco
production went down below 50 million kg… Now we are above 222 million
kg of tobacco a year,” Mnangagwa said, adding the country had recovered
and surpassed the 200 million kg which the 4 5000 white farmers used to
produce.

Mnangagwa’s figures were grossly exaggerated though, as the black farmers
are only producing 170m kgs as compared to the 200-plus million kgs that
white farmers used to produce.

All the same, Shonhe said a middle class of small-scale peasants is
emerging, constituting over 65 percent of the farmers

“This class of farmers is highly linked to both global capital but mostly
self-finance from surplus income from sale of agricultural products,” he
said. “In other words there is a new class of farmers that are not tied to
state patronage machinery and who are highly incorporated into the global
commodity markets, with some depending on own resources.”

Ian Scoones, an agricultural ecologist professor, highlighted how “these
patterns of class mobility and consolidation are changing the rural or
farming landscape in Zimbabwe.”

“In simple words a transmogrification of immense proportion is happening
right before our very eyes and it can only be ignored by the politically
blind,” he said. Tamuka Chirimambowa and Tinashe Chimedza said in a
research paper that to get a first-hand experience of the social mobility
of new farmers, one has to visit the car sales, furniture shops and
hardware wholesalers amongst many other merchants in Harare during the
tobacco selling season to witness the acquisitions of the new farmer from
the proceeds of farming.

“That our friends, is the old dynamic of capital at work,” they said.

Shonhe said social and political movements have not been able to align
themselves with this new set of farmers but through state-mediated Command
Agriculture, a completely different set of farmers is in the making.

“Zanu PF is now developing new capitalist farmers on the back of food
maize contract farming relying on national and international contract
farming and targeting and creating new political alliances with the farmer
and his workers in the A2 sector,” Shonhe said, adding: “To my mind, this
is what will matter in 2018 (elections).”

He said participation in the production of contract crops has been
broadened or democratised after the liberalisation of the economy from
2008. Rural small scale farmers and A1 farmers under fast track and old
resettlement now dominate.

Some A2 farmers and some remaining white commercial farmers also produce
on bigger lands but contribute a lower amount of tobacco compared to small
scale farmers.

Veteran economist John Roberston differed, saying phrases suggesting that
resettled farmers are now disguised workers for former white farmers and
that former white farmers continue to control the land through contract
farming “can be considered misleading.”

He explained that many high-ranking members of the ruling Zanu PF party
were given generous land allocations and their status in the party
permitted them to obtain large unsecured bank loans. But most of these
were not repaid and many banks were at risk of failing when the
non-performing loans began to make up a dangerously high proportion of
total loans.

To rescue the banks, some of which belong to government, the Reserve Bank
created the Zimbabwe Asset Management Company (Zamco). This took
non-performing loans off the books of the over-extended banks at a price
that has helped to restore the banks’ capital adequacy.

Robertson said a secondary purpose was to rescue the important party
members, who appear to have used political influence, rather than
collateral, to borrow substantial amounts that they could not repay.

If the loans had been well secured, the lending banks would have recovered
the debts by selling the securities. Instead, the large debts of several
hundred people have been taken over by the Reserve Bank and those debtors,
who should have been prosecuted for being in breach of contracted payment
have forfeited nothing.

But, in the past year, the Reserve Bank has pursued a plan to recover the
money. Many commercial farmers, who had been evicted during the land
reform programme and left with nothing to do, were found to be willing to
apply their skills towards making the defaulters’ farms productive again,
Robertson said.

“Under special arrangements negotiated through experienced organisers,
many dozens of commercial farmers have been placed back onto good pieces
of land, but on terms that will secure their tenure only for the years
that will be needed to grow enough crops to repay the debts,” he said.

“The re-engaged commercial farmers hope that their success will initiate a
process that will eventually get them and others properly reinstated on
the land, supported by much longer-term tenure and bankable arrangements.”

So far, on its much more limited basis, the idea is working, he said.

“A large part of the improved maize crop now being harvested is coming
from these farms. Good farmers with nothing else to do are accepting the
arrangement because they are back at work,” Robertson told the Daily News
on Sunday. “The defaulting borrowers are accepting the idea because it is
better than having to learn how to work and then having to actually do
some work. And it is far better than being prosecuted for breach of
contract. So, those in breach of repayment agreements are let off while
skilled farmers spend some years repaying their debts, hopefully deriving
a modest income in the process.”

As the new owner of the non-performing loans, the Reserve Bank has put up
most of the funds needed to get these farmers back to work. This funding
was the only tangible component of the “Command Agriculture” concept, he
said.

Robertson said the “Command Agriculture” in the process did successfully
inject this money into agriculture, but if the land had not been stripped
of its collateral value, the banks would have readily supplied all the
funds needed directly to the farmers.

Instead, the ministry of Agriculture had to increase its 2016 capital
transfer account of $66 million to $615 million for 2017.

This is disclosed in the former Finance minister Patrick Chinamasa’s
mid-year budget review and 2017 outlook statement, presented to Parliament
on July 20.

In this statement, Chinamasa said that the “command” model was being
replicated for the 2017-18 season for other crops, such as wheat, soya
beans and the livestock sector. Proposals for sums totalling $487 million
will extend government support to cotton growers and to “about 1,8 million
rural vulnerable households”.

“Contracts between tobacco growers and tobacco buyers were formed on the
strength of farmers’ ability,” Robertson said.

“In the new arrangements, capable farmers have taken over from many who
failed to produce the crops needed to repay the loans.”

“Land that was vacant or poorly used is now productive and debts are being
repaid. `White capital’, whatever that is, has nothing to do with
anything. The topic is all about how capable people are now engaged and
helping to solve a problem for a small part of the farming community and
for the banks.”