Govt exits the National Enhanced Agriculture Productivity Scheme
High levels of defaulters and unwillingness by farmers to deliver produce to the Grain Marketing Board (GMB), has forced government to review the National Enhanced Agriculture Productivity Scheme (formerly Command Agriculture) financing model as part of the agriculture financing reform to reduce the burden on the fiscus.
This is part of measures introduced by Finance and Economic Development Minister, Professor Mthuli Ncube in the 2024 National Budget.
“Government used to support commercial farmers under the National Enhanced Agriculture Productivity Scheme (NEAPS), through extending guarantees to commercial banks. However, due to high levels of defaulters and unwillingness by farmers to deliver produce to the GMB, Government has reviewed this financing model to give room to a more commercialised approach led by private financial institutions,” Ncube said.
The aim of NEAPS is to ensure food self-sufficiency in Zimbabwe through the support of wheat, maize and soya bean production.
The arrangement was such that government through the Ministry of Finance and Economic Development provided funding for NEAPS to guarantee payment to the different input suppliers. The farmers repay their input loans with product through delivering the equivalent amount of produce to the GMB to cover their loan.
The banks’ role in the NEAPS program was to identify farmers, source suppliers, distribution of inputs and reconciliation of farmers’ accounts.
During the upcoming 2023/24 agriculture season, Government is only extending partial guarantees to AFC and NMB, while the rest of the financial institutions participating in the programme will use their own financial resources.
“This is part of the agriculture financing reform to reduce the burden on the fiscus and letting the financial sector play its role,” Ncube added.
Government will promote organised business models which brings together farmers, entrepreneurs, financiers and markets, establishing a complete business cycle that empower communities, create employment, improves the standards of living of marginalized communities and the inclusion of youths, women and people living with disabilities.
“This model should, therefore, uplift the livelihoods of the rural population and reduce rural to urban migration through economic empowerment and inclusivity in the ten provinces in line with Devolution and Decentralization Policy,” according to Prof Ncube.
