More finance for sugarcane production
MBABANE – The market of sugar is constantly on the rise and Eswatini is failing to meet export demands.
Sugar is not the only product that the country is failing to supply at equilibrium with the demands of the market, as sugar beans and beef have also been included on the list. Eswatini Sugar Association (ESA) Acting Chief Executive Officer (CEO) Banele Nyamane said March and April were challenging for the industry.
He said this was prompted by the decrease of nine per cent in cane production, a 10 per cent drop in processed sugar and six per cent drop in profits.
The World Food Programme (WFP) requested Eswatini farmers to supply 53 000 tonnes of sugar beans to the international market and the local market supplied 10 000 tonnes. This then forced WFP to procure the remaining 43 000 tonnes from outside countries.
The WFP and the Ministry of Agriculture have an agreement that would enable Eswatini to supply about 53 000 tonnes of sugar beans to the international market annually. Minister of Agriculture Jabulani Mabuza said the country was, at the moment, not able to supply the market because local farmers were not able to reach the target.
The World Bank also cited that beef production in Eswatini has decreased immensely, further compromising the
Products financed by the bank
Farm purchase Sugarcane farming Vegetables and field crops production
Feedlot farming Dairy farming Poultry production
Piggery production Agro-processing quality. This has led to both private sector and government working together to address the challenges contributing to the stated cause.
Type of enterprises financed
All start-up businesses
All sugarcane production enterprises
All other crop enterprises
Addressed
The Ministry of Agriculture as well as Ministry of Commerce, Industry and Trade have addressed some of the concerns which contribute to the country not being able to meet market demands.
Standard Bank of Eswatini Chief Executive Mvuselelo Fakudze said lending money to businesses was one of the difficult tasks faced by banks.
He said giving a guarantee that the money would be returned back to the owners was the factor that made it difficult
TABLE SHOWING PRODUCTS FINANCED
Credit scheme used
Export Credit Guarantee (ECG) for E3.3 million (max)
Small Scale Enterprise Loan Guarantee Scheme (SSELG) for E1 million (max) for banks to give such loans.
“In most cases, we then have to search and run after people who then fail to pay back the loans and most of them always shun away,” he said.
Fakudze said the role of the banks was to safeguard people’s money and re-invest it to the market for it to grow.
He said if businesses wanted less interest charged on their accounts, they should mind their account conduct to increase faith with banks. He said the sugar industry works had a good relationship with local banks thus farmers should focus more on performance.
The EswatiniBank Agri-Business Unit is working on expanding their footprint in the agricultural sector of Eswatini.
This was mentioned by EswatiniBank Managing Director (MD) uNlunkhulu Nozizwe Mulela during the Agri-Business Forum at Mhlume Country Club.
The MD said this upcoming initiative involved partnering directly with farmers in the country to tap into scarcely explored markets in crop production.
She said they had other initiatives in the pipeline that included enlarging their footprint across the country by opening a new branch at Buhleni and offering services that met worldwide standards.
“Through these expansions, we want to make our services available to all farmers, especially to those living in the outskirts of town,” she said.
The MD added that food security was
Documents required
Company documents
Certified copies of IDs for all directors Resolution by company directors to borrow Certified copies of certificate of incorporation Memorandum and articles of association, form J and or C. an issue that most are vaguely aware of, and they believed that as EswatiniBank they should play their role in proactively seeking practical solutions of reducing the impending scarcity. Mulela said the bank wished to partner with institutions such as the Royal Eswatini Sugar (RES) Corporation and other industry related stakeholders to explore efficient ways to help clients through financial investment and innovative advisory.
She said a close working relationship between farmers and agricultural lenders was essential to the economic growth of agricultural borrowers and the continued success of agriculture within the country.
Mainstay
“Agriculture remains the mainstay in Eswatini despite the challenges faced, as such, it is important to continue to tailor effective supervision and regulation to ensure the safety and soundness of agricultural financiers, while also making sure that undue burden does not constrain the capacity of these institutions to continue supporting the agricultural communities they serve,” she said.
The MD further mentioned that working with the University Of Eswatini (UNESWA), the Faculty of Agriculture had aptly identified a small team of multi-sectorial experts, led by Prof Ambrose Manyatsi, who will be thinking through on how the bank is going to assist the agricultural sector in dealing with climate change and adaptability.