Government scraps free handouts for farmers

Source: Government scraps free handouts for farmers | The Financial Gazette July 14, 2016

THE relentless cash squeeze gripping Zimbabwe has forced government to scrap issuing free farming equipment to thousands of farmers who have for years been depending on it for survival, the Financial Gazette can report.
Vice President Emmerson Mnangagwa made the revelation last week at the Buy Zimbabwe Summit held in Mutare.
Zimbabwe’s indigenous black farmers, who benefited from the controversial seizure of land from former commercial white farmers since 2000, have for years been spoon-fed by government, receiving free inputs and farming equipment.
Regardless, production levels have plummeted on the farms, resulting in the new farmers failing to feed both themselves and the nation at large.
The chaotic land reforms have therefore largely contributed to the collapse of commercial farming.
It has also had a domino effect on the manufacturing sector, which relies on output from agriculture.
Mnangagwa said the withdrawal of freebies was meant to end the dependency syndrome in the country.
Mnangagwa said the country should take advantage of the large water bodies it has to produce food through irrigation.
“We are resuscitating irrigation schemes and all those living around water bodies across the country are being organised to use water and equipment province by province,” said Mnangagwa.
“There are some who benefited from equipment from Brazil which was distributed by government under phase one. More equipment is coming, but there will be no more free handouts of equipment to the farmers,” he added.
This development could mean farmers are headed for a tough time as this would negatively impact on those who cannot afford the high prices of the equipment.
Last year, Zimbabwe received agricultural equipment from Brazil under the South American country’s “More Food for Africa” programme worth close to US$40 million to boost output.
It was the first of three tranches coming under a US$98 million loan facility secured from Brazil.
Beneficiaries of the scheme are farmers who benefited from the land reform programme.
The loan will be repaid by the Zimbabwean government over 15 years at an interest of two percent per annum.
Agribank, is administering the loan on behalf of government.
The equipment included tractors, fertiliser spreaders, and irrigation equipment.
The ruling ZANU-PF party is hoping that the facility would help it achieve targets set under the Zimbabwe Agenda for Sustainable Socio-Economic Transformation blue-print.
But this is proving to be difficult.
Economist John Robertson believes that the equipment was, in the first place, not supposed to be given for free to farmers as this would prevent the farmers from becoming self reliant and efficient.
“The Brazilian equipment … was not supposed to be given for free to the farmers,” said Robertson.
“In the end, it seems to have been allocated to senior party members. Perhaps it has all been given out by now and this is being hidden under a claimed policy change. Also, the costs of the inputs have always been beyond government’s resources, which usually meant that seed and fertiliser packs were delivered late and their distribution favoured party supporters.”
The collapse of agriculture is rooted in the failure to develop an effective land policy and the distribution of multiple farms to a small political elite, who, for the most part, have not used them productively.
Many of these “new farmers” have allowed viable farms to become derelict, while more invasions are taking place.
Consequently, the country has remained a net importer of grain following the controversial land reform exercise.
Banks have also been reluctant to offer loans to farmers due to lack of security.