Kudzanai Gerede Business Correspondent
Government should address security of land tenure by providing long-term leases to both A1 and A2 farmers to ensure long-term planning at farm level if agricultural evolution is to effectively take place, advisor to the Office of the President and Cabinet (OPC) taskforce on ease of doing business, Professor Ashok Chakravarti has said.
Speaking to Post Business on the sidelines of a parliamentary postBudget seminar in Harare last week, Prof Chakravarti said one of the contentious issues holding back agricultural growth in the country was the issue of security of land, particularly the large-scale farmers whose land has not been securitised therefore making it hard to access capital for production.
In most West African countries such as Ghana and the Ivory Coast, farmers have been given long-term leases, which make them attractive to foreign investors who invest their financial resources in partnership with local farmers to increase output. This also enhances export market linkages for local farmers.
Currently, Government is giving offer letters to holders of land, a scenario Prof Chakravarti says goes against the ethos of ease of doing business as it makes local farmers less competitive as compared to their regional counterparts whom they are supposed to compete with on the regional and international export markets.
“As a key complementary measure to the resuscitation of the agriculture sector as the mainstay of the Zimbabwean economy, I suggest a fast track approach in addressing security of land tenure as a prerequisite to giving our farmers leverage when they want to access financial markets.
“Offer letters do not provide any security in realistic terms. We should be able to ensure that our farmers have leases, probably 99-year leases to both A1 and A2 farmers as has been done in other African countries. We are not in any way trying to reinvent the wheel, this is working in West African countries and agriculture production has been booming since then,” said Prof Shakravarti.
Most of the local farmers are still struggling with mechanisation to increase production volumes as there has not been adequate investment outside Government interventions to bail out farmers.
Analysts, however, say if local farmers are given leases, they can be able to negotiate finance at individual capacities given variances of farm needs rather than continue to rely on blanket Government assistance.
Credit to farmers has been limited despite Government coming with the Movable Property Security Interest Bill last year that allows movable assets to be acceptable as collateral but financiers, both banks and private companies, remain sceptical, preferring fixed assets such as land instead.
This has seen Government offer necessary security on behalf of farmers as the case with the successful Command Agriculture that saw the private sector providing US$160 million in financing agriculture.
Prof Chakravarti also said Government should also immediately embark on a land audit to put a stop to multiple farm ownership which is evident in some areas where farms are lying idle
AgronomistMr Charles Dhewa concurred that security of land tenure remains important in order to improve synergies along the agricultural value chains.
“The issue of land tenure is important for the sake of foreseeable continuity of supply and production along the various value chains of agriculture. Private companies would want to commit to long-term contract farming with holders of land and they need that guarantee for continuity,” he said.