adminOliver Kazunga Business Reporter
THE Zimbabwe Farmers’ Union (ZFU) says the decision by government to subsidise agricultural input suppliers is good but fears the facility is likely to be abused.
Agriculture, Mechanisation and Irrigation Development Minister, Dr Joseph Made is on record saying the 2013/14 cropping season would be the last time government provides direct input support to farmers. He said focus would now turn to subsiding manufacturers to lower input costs.
ZFU second national vice-president Berean Mukwende said subsiding private companies was not good under the present environment when the economy was facing liquidity challenges.
“It is a good development to support input suppliers but on top of that supporting the market with output is important because that will assist the farmers,” he said.
For a long time, the Government has been saying subsiding manufacturers is the preferred form because it assists the policy makers not to be involved in the day to day allocation of inputs to farmers.
The Government hopes that if input suppliers are subsidised of inputs that will lower the cost of production and farmers would be able to buy the inputs on their own.
Mukwende said the subsidy should look at producer prices so that the farmers were assisted to meet production costs and be able to go back into the fields the next season.
“The suppliers can abuse the facility and we are saying given the limitation of resources that the country has at the moment, the suppliers can be provided with subsidies in the form of rebates, tax exemption on imported implements and other inputs. The subsidies should not come in financial terms because there is a high chance that the resources will be channeled to other businesses that are not for the intended purpose and this, if it happens, is difficult for government to trace,” he said.
Presenting the 2014 national budget, Finance and Economic Development Minister Patrick Chinamasa said other than poor rainfall and prolonged dry spells; agriculture growth has been weighed down by acute under-funding resulting in low yields.
“In the case of cereals, average maize output during 2009-13 has been hovering around 960 000 tonnes per annum, against a national consumption requirement of 2.2 million tonnes, including for stock feed,” he said.
For the 2013/14 agriculture season, the Government provided a $161 million facility, of which $157.9 million is for inputs and the balance of $3.1 million caters for the rehabilitation of District Development Fund tractors and the Grain Marketing Board handling costs.
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