Govt makes $487m agric funding record

Source: Govt makes $487m agric funding record | The Herald June 26, 2017

Felex Share Senior Reporter
Government has secured a $487 million facility to fund the 2017-18 agricultural season and movement of inputs under the Command Agriculture and Presidential Input Support schemes is expected to begin next month, The Herald can reveal.

It is the first time Government has signed a summer cropping facility on time since 1980.

Sakunda Holdings, who funded the 2016-17 agricultural season to the tune of $192 million, will this time work with CBZ, Ecobank and Barclays banks to provide the funding.

Finance and Economic Development Minister Patrick Chinamasa on June 12 signed a term sheet for the $487 million facility with Sakunda Holdings.

All inputs supply agreements have been sealed.

About 70 percent of all inputs will be sourced locally to boost local producers.

Government intends to build on the success of the Command Agriculture initiative and the Presidential Input Support scheme recorded this year which is forecast to exceed the target of 2 million tonnes of maize.

Command Agriculture, a grain import substitution programme launched last year pursuant to the Food security and Nutrition cluster under Zim-Asset, is a brainchild of First Lady Dr Grace Mugabe.

President Mugabe assigned Vice President Emmerson Mnangagwa to superintend over the programme whose success has seen Government stopping grain imports.

Documents show the latest $487 million facility is targeting 350 000 hectares, up from the 172 00ha planted last year.

Of this hectrage, 290 000ha will be under maize, while 60 000 ha will be under soya beans.

The Presidential Input Support Scheme, documents reveal, will be covered by $153 million while the remaining $334 million will be used for Command Agriculture.

“Delivery of inputs will start on July 1 and that is expected to be completed by September 30, 2017,” read the documents.

“Following the success of the agricultural schemes last season, banks are stampeding to be part of the process and Sakunda Holdings is negotiating with two other banks other than CBZ, Barclays and Ecobank, who want to be part of the programme.”

The report goes on: “Agreements on the supply of inputs have been concluded and seed maize will be supplied by companies such as SeedCo, Arda Seeds, SIRDC among others while fertilizer companies include Sable, Windmill, Ferts Seeds and Grain (FSG). Chemicals will be supplied by Fossil Agro, CP Chemicals and Cure Chem among other companies.”

The Presidential Input Support Scheme will this time cover 1,8 million households.

The development flies in the face of critics of the Command Agriculture Programme principally Higher and Tertiary Education, Science and Technology Minister Professor Jonathan Moyo who has been lambasting the project on social media.

Prof Moyo, whose family benefited from Command Agriculture, has been lampooning the programme insinuating that part of the money used last year was missing.

Apart from social media, he has also been using the private press to discredit Government programmes.

Yesterday, the private media quoted a “report” from the Ministry of Finance and Economic Development’s public debt management office, claiming Sakunda had traded the Treasury Bills which were issued by Government for the 2016/17 season.

It emerged yesterday that the TBs were not traded but were being held by CBZ and Ecobank.

The contract signed between Sakunda and Government in October last year specifies that the TBs are non-tradable.

Finance Minister Patrick Chinamasa yesterday said they had no problems with Sakunda Holdings.

“As far as I know, we have a good working relationship and we are working on other programmes and other private players are coming on board,” he said.

Information at hand shows the Government provided security on the $160 million facility on behalf of the farmers in the form of TBs.

“The TBs were issued way after Sakunda Holdings had started moving inputs, something which the company could have easily rejected as everyone demands security upfront. The securities were provided in case farmers failed to pay or in the event of any catastrophe.”

Farmers are delivering maize to the Grain Marketing Board and 80 percent of their produce is going towards debts.

Trek and Arda have paid $240 000 of the $1,5 million they jointly owe.

A Government official yesterday said claims that Sakunda Holdings had traded the TBs were driven by malice as they mature in 2018.

“This is coming from the same people who are criticising Command Agriculture,” said the official.

“To show that the paper (from the Ministry of Finance) was cooked, it puts the interest rate on last year’s $160 million facility at 15 percent yet it was five percent. To show that Government has confidence in the petroleum company, it went on to sign other contracts like the winter wheat programme ($50 million) and the latest facility of $487 million. To say it is difficult to recover the cost of the inputs is hogwash as Government has a database of all farmers who received the inputs including Prof Moyo’s family.”

President Mugabe has hailed Command Agriculture at his ongoing interface rallies with the youths saying the programme is one of the rallying points for Zanu-PF ahead of harmonised elections next year.