GOVERNMENT has called on all farmers under Command Agriculture to repay their obligations to ensure the continuity of the programme and increase productivity on farms.
This comes at a time when the Government is acquiring loans from the private sector to empower farmers who failed to access loans from the banks due to lack of security.
Consequently, failure to pay back loans would hamstrung Government’s operations as they will be forced to directly pay funders then collect money from farmers through stop orders.
Lands, Agriculture and Rural Resettlement Minister Perrance Shiri (pictured right) told The Sunday Mail Business that loans repayments would enhance productivity as more banks would be willing to fund successful farmers.
“We would like our farmers to repay loans, especially, under import substitution programme, Command Agriculture, so that the funders will be able to finance us in the coming seasons.
“If us as farmers don’t pay up loans we are letting ourselves down as the private sector which gives us money will withdraw its support.
“This programme (Command Agriculture) was done for farmers, who were failing to access money from banks and other financial institutions, to enhance productivity on farms to ensure food security and save foreign currency at the same time,” said Minister Shiri.
From last year’s command programme, Government was forced to pay over $100 million to funders after farmers only paid approximately 60 percent of the loan.
Treasury had to pay the balance to maintain good relations with the companies which supported the programme.
The 60 percent recovery rate is better compared to other years where companies could not recover anything.
Of the two categories of Command Agriculture loans, which are Command Agriculture Revolving Fund and Command Inputs loan, farmers have repaid over 60 percent.
And from the total of over US$200 million lent to farmers, over US$120 million has been paid back.
The healthy recovery rate comes at a time when the private sector was not willing to finance agriculture due to poor retrieval rate and now that all their obligations have been met, they have changed the narrative.
Due to strict and consistent monitoring under Command Agriculture, the recovery rates of agriculture loans has improved, and consequently banks are now very willing to fund the sector.
Out of the 50 000 farmers contracted to produce maize under Command Agriculture, 33 percent fully paid their loan obligations, with 22 percent having partially paid their obligations, while recoveries from others are being made as they deliver to the GMB.
Government has instituted measures to ensure recoveries from the farmers, with monitoring teams already deployed to follow up on those who were being made to acknowledge their debts for repayment next season.
To encourage farmers to continue paying back their debt obligations, all fully paid up farmers were being prioritised in accessing inputs under the 2018/19 Command Agriculture programme.
President Mnangagwa is on record warning those who abuse Command Agriculture inputs that Government will deal with them accordingly.
Command Agriculture, a brainchild of the Government, has rescued thousands of farmers who would have failed to productively use their land owing to funding challenges.
Under the programme, farmers receive inputs for free, but are expected to deliver five tonnes of maize each to the GMB.
In the 2017/2018 summer cropping season, the private sector scrambled to fund the command project as they were now sure that their money was going to be recovered.