‘We’re hopeful new dispensation will achieve turnaround’
GOVERNMENT has come up with a policy shift on issues concerning land tenure and bankability. This has resulted in the State calling on all remaining white farmers to be issued with 99-year leases, a marked policy shift from the previous arrangement where they could only get five-year leases. Our Senior Agriculture Reporter Elita Chikwati (EC) talked to the Commercial Farmers Union (CFU) director Mr Ben Gilpin (BG) to find out the union’s views on these new developments and how this will impact on the agriculture industry. EC: As the CFU, what are your sentiments towards the new political dispensation in Zimbabwe? BG: We are hopeful that the new dispensation will achieve the turnaround for Zimbabwe that we all long for. We will certainly do our best to support that where we can. We are committed to a broad-based and inclusive recovery and believe settling compensation will greatly assist in this. EC: The land question has been at the centre of social, political and economic issues in Zimbabwe. What do you think the new administration should do to promote agro-business and growth of the agriculture sector considering that agriculture is the backbone of the economy? BG: A comprehensive recovery is essential. We hope that finality can be brought speedily to the land issue which has been at the heart of conflict for too long. This we believe can be accomplished. Investment will follow by ensuring that all farmers have a full bundle of transferable rights.
While access to land has been greatly extended, more than access is required to ensure growth. Bankability, coupled with essential skills will truly empower farmers. Agriculture is a long-term business requiring patient inexpensive capital. This is found where property rights and the rule of law are respected. EC: What do you think is the role of Government in all this? BG: Government’s role is to ensure confidence in these. They are also responsible for creating a conducive environment where we become competitive. The agricultural sector must produce inputs that can be processed by industry. At present, industry cannot compete with many imported products because our produce is too expensive. The cheaper we produce agricultural goods to go into the value chain, the more we will grow industry and become competitive with neighbouring exporters. EC: How many white farmers are still on the land?
BG: We estimate only around 200 to 300 white farmers remain on properties that they owned. Most of these are on downsized portions of original holdings. Not all have offer letters, although most have applied for these and are hopeful that they will receive these. Some are still trying to remain on the land often through protracted legal processes. There are also a number of white farmers leasing titled land from indigenous owners who purchased these farms. Others sought to enter into joint ventures often encouraged by high maize prices or other perceived opportunities. EC: A number of people have felt that the CFU seeks to reverse the land reform programme. What is your comment on that? BG: CFU advocates for the interests of its members. This includes a sizable number of farmers who invested their energy and skill and who have lost all to the land reform process. A considerable number of farm workers were also affected and lost homes and livelihood in the process. EC: So are you saying Government did not have the right to carry out the land reform? BG: Governments clearly have a right to acquire land in the public interest. We would argue that the acquisition without recourse has been at the heart of national economic decline and isolation. We appreciate that to a degree, this was motivated by historical grievance, but could have been done without the massive disruptions to social economic situation. EC: So what does your constituency offer to the sector?
BG: As committed Zimbabweans, we want to see the country recover and for our constituency to feel safe to pursue their chosen profession without discrimination. We would suggest that Zimbabwe would benefit greatly from re-engaging these skills. The cost of compensation is substantial
and we believe every effort should be made to engage this in recovery. There is also a younger generation keen to farm with equal access and opportunity to other Zimbabweans. Much of the acquired land is not being farmed effectively and we hope that an audit will bring accountability and ensure access to genuine farmers. EC: What is your reaction to the announcement of new tenure systems for white farmers from five to 99 years? BG: This is a positive move. So far, it appears only those with offer letters will be eligible. Many white farmers have applied for these but have been unable to get them. Farming is a longterm business so an extended tenure is essential for this. However, we believe the entry of farmers to the industry should be market led. Offer letters do not give farmers a full bundle of empowering rights and their issue is subjective. Offer letters can be withdrawn and have been without objective process. EC: Will the extension of the period of the lease from five to 99 years be of any significance to your constituency considering that some of your members already have access to funding? BG: We are yet to see the provisions of the new 99-year lease. Banks are likely to be the arbiter in this. For now most farmers are financing their operations through contracts rather than the banks, which avoid the risk because the land no longer has collateral value in the absence of a market. This effectively means the contracted farmers borrow from the same entity that purchases their product. It is a significant disadvantage and farmers often feel that they are trapped by this arrangement. EC: Government has announced that the 99 year-lease is now bankable and transferable. How do you view this policy and how will it impact on the agriculture sector? BG: We await to see how banks actually react. If the system is truly tradeable and simple, we will see an improvement. For many farmers and the banking sector, we are certain the option of full title would be attractive. Perhaps Government should re-look at this. It was a very effective driver of development and can be used again. In the past, banks used the security of titled property lodged with them as the basis for getting lines of credit to on lend to farmers. This capacity has been lost. This had affected not only former large scale commercial farmers but also farmers such as those from the small scale commercial areas or purchase areas. Those properties, although titled are hardly bankable because there is no market with do much access to land outside the market.
This is a fundamental issue. A tradeable 99-year lease would enable farmers to borrow and sell from different sources to advantage. The big question is to what extent is Government prepared to allow the market to decide who had access to land. EC: Do you think farmers will have the capacity to pay back loans or they will end up losing the land to financiers? BG: Farmers need a competitive and cost effective environment to operate in. There is much to be done on the cost side regarding ease of doing business and price of fuel, electricity and charges and input costs. Farmers also need to improve productivity. Economies of scale need to be recognised particularly for row crops and the like. There will always be farmers who succeed and those who fail. The commercial sector in the past was always seeing farmers come and go.
Currently, many farmers are forced to use urban property to secure agricultural borrowings. Really these should be secured against agricultural and farm assets. Judicious borrowing and lending by farmers and lenders should enable a stable situation.
Farmers need to manage their financial risk and Government needs to ensure affordable credit is available for short, medium and long-term requirements.
Management skills are essential as well as the farmers farming skills. EC: What models do you think can be applied for agribusiness to achieve take off? BG: There are many models. We believe much can be done on the hub system. The most important matter though is likely to be skills and access to markets and finance at affordable levels. EC: What do you feel about investors from South Africa coming to Zimbabwe? Are they in anyway threatening your constituency? BG: With regards to the South Africans, we will need their skills and investment but would like to see Zimbabweans accommodated first. We have come through hard times together and we look forward to an inclusive recovery. We would certainly prefer to see local Zimbabwean farmers during the land reform accommodated ahead of foreigners. All investors need an assured legal and consistent policy environment. We also need to be a competitive destination. We hope that with these in place, Zimbabwe will thrive with the diversity and skills of all its people and others who come here to assist us. EC: Moving ahead what plans do you have as a union to work with resettled farmers? BG: From the perspective of the union we see organised agriculture as the backbone of advocacy for farmers. To this end, we are working closely with other unions and are a part of the Federation of Farmers Unions (Fofu). We are committed to this process which will see farmer representation merge on the ground. This will foster increasing collaboration. We hope to be a part of unified farmer representative body where all farmers are empowered and able to meet the expectations of the country and collectively we regain our brand as the bread basket of the region.
As with the birth of a child, a lady on being congratulated will say, “Aiwa ndeedu tese.” So, we hope the same can be said of the country’s agricultural sector.