Commercial Farmers Union of Zimbabwe

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Zimbabwe Farmers’ Union’s deathwish

Zimbabwe Farmers’ Union’s deathwish

http://www.theindependent.co.zw/

October 26, 2012 in Opinion

SINCE Zimbabwe embarked on its ill-conceived land reform programme in 2000, 
its agricultural activity has been semi-moribund.

Report by Eric Bloch

Farmers endowed with great expertise and necessary capital resources to fund 
their operations generated immense productivity, making Zimbabwe the 
“breadbasket of the region”.

So great was the crop output that Zimbabwe was able to satisfy national 
needs for maize, wheat, sorghum and many other agricultural outputs, as well 
as export surplus to neighbouring countries.

The bountiful production provided employment for more than 300 000 
agricultural workers, and created downstream employment in those 
manufacturing operations that value-added the crops produced.

However, with the pursuit of the land reform programme, the majority of the 
experienced and financially-secure farmers were evicted from the land.

The land was then allocated to so-called “new farmers”, most of whom lacked 
the necessary in-depth expertise, and financial resources. Consequently they 
could not timeously fund the purchase of essential inputs ranging from seeds 
to fertilisers and chemicals; neither could they afford energy supplies nor 
maintain irrigation systems.

As a result, agricultural productivity declined and Zimbabwe became 
dependent on importation of essential foodstuffs.

At the same time most of the much-experienced farm workers lost their 
employment, becoming poverty-stricken. Admittedly, in the last few years 
there has been an increase in agricultural output, but it still falls far 
short of the levels of production that prevailed prior to the disastrous 
land reform programme.

Key to productivity decline is the inadequacy of funding available to new 
farmers. Whilst their predecessors could supplement such funding in addition 
to borrowing from banks and other financial institutions, the new farmers 
cannot do so.

That inability to access funds for productive, farming operations is due to 
lack of collateral security, a world-wide prerequisite to support 
borrowings. The previous farmers were able to encumber their farms in favour 
of lenders, thereby giving the lenders the security necessary to assure 
recovery of monies lent. The ability of the pre-2000 farmers to provide 
security was founded upon title to the ownership of their farms.

In contrast, with effect from 2000 all right and title in and to the land 
was vested in the state. New farmers who settled on the land were not 
accorded any ownership rights, only being entitled to occupy and work the 
farms by virtue of 99-year leases (although government reserved the right, 
in many of the leases, to terminate them on three months’ notice!).

Belatedly, and with great reluctance, government eventually recognised that 
monumental constraint upon agricultural productivity. When opening 
parliament in late 2011, President Robert Mugabe stated legislation would 
shortly be tabled before parliamentarians to restructure the farm leases in 
a manner as would accord new farmers leases with collateral security to 
extend to lenders.

However, nearly a year later, no such legislation has been enacted. Only a 
few weeks ago, Mugabe said reversion to the issuance of title deeds, or 
modification of leases would under no circumstances be considered, hence new 
farmers are facing the 2012/2013 agricultural season with the same appalling 
illiquidity constraint that has impaired agricultural production for many 
years.

Last week the Zimbabwe Farmers’ Union (ZFU), whose membership comprises new 
farmers, issued a statement urging that under no circumstances should 
government change its policy on the 99-year leases. The ZFU emphatically 
stated that doing so would be prejudicial to new farmers, for they would 
then use the lands, or the leases, as collateral to access funds from the 
financial sector, whereupon the lenders would undoubtedly dispossess the 
borrowing farmers of their occupancy and operational rights.

The ZFU was in fact implying new farmers would not productively use their 
borrowings, and therefore fail to service their repayment obligations and 
lose the land they occupy. One inevitably draws the conclusion that by so 
doing, ZFU believes that even if accorded necessary funding, members would 
not use the funds procured in any productive manner, and would fail to meet 
repayment obligations.

Such scepticism of the fiscal morality and probity of its members is 
shocking, and seeks to discourage government from pursuing a key initiative 
necessary to ensure the recovery of agriculture.
If agriculture is to be restored to its former glory, it is essential Mugabe 
and government disregard ZFU’s death wish, and take swift action to enable 
new farmers to source funding essential for their operations.

Ideally, Zimbabwe should reinstate title deeds for rural land, albeit 
possibly with a constraint that transfers can only be effected in favour of 
those who are alluded to as “new farmers”, and barring transfer to anyone 
already possessing title deed vested rights of land usage ( One Man, One 
Farm.) Nevertheless, many politicians and their associates already have 
usage rights on several farms.

In the alternative, if reversion to title deeds is unpalatable to 
government, the leases should be modified to assure their continuity for 99 
years, and to accord them ready transferability to alternative lessees, 
whilst again entrenching the “One Man, One Farm” restriction.

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