adminUsing the 99-year leases as collateral could potentially derail the gains of the agrarian reform, the Zimbabwe Farmers’ Union has said.
The farmers’ representative body said Government should instead enhance regulation of bank lending to the agriculture sector to ensure that farmers benefit from internal capital without placing their land at risk.
In an interview with BH24, Zimbabwe Farmers’ Union second vice-president Berean Mukwende said farmers must not use the 99-year leases as collateral to acquire loans from banks but Government must regulate rates and charges which banks require to farmers.
“Banks are charging high rates of about 20 percent interest and penalties of about 40 percent to farmers who are trying to increase production. The rates are not fair looking at the economy.
The Government recently indicated that it is finalising amendments to the 99-year land leases to make them bankable, but remains cautious on making them transferable in case the farmers default on loan repayments.
The ZFU has said most of the farmers are doing well in terms of crop production but require Government assistance to boost their production.
Mukwende said Government must put regulations which comply with both farmers and banks to create an atmosphere which allows both parties to benefit.
Mukwende also said research and training are also critical components in agriculture for the country to maintain food security and boost the economy.
The 99-year leases were offered by Government to farmers during the land reform programme so that farmers could have full control over the land, with the agrarian reform targeted to positively transform the agricultural sector. – BH24
Online Reporter