Govt seeks funds for command agric
THE Government is looking at supplementing finances for its multi-million investment programme for the 2016/17 agricultural season with funding from pension funds and insurance companies.
Recently, Government launched command agriculture with a target of financing 400 000 hectares of the maize crop. The programme is expected to produce two million tonnes of maize, which would drastically cut the food import bill or eliminate it.
The Government has already appealed to the Zimbabwe Association of Pension Funds to assist in raising $348 million required to finance the programme.
“The ZAPF has been requested to give an indication of how much Self-Administered Funds will contribute towards the project,” said the association in a note to members.
“Government bonds with prescribed asset status are going to be available in the market soon and members are requested to assess their cash flows on a monthly basis, over the next twelve months starting September 2016 and indicate to the ZAPF what contributions they are likely to make towards financing this project,” it added.
In terms of the law, the industry is expected to comply with a prescribed asset ratio of 10 percent of fund portfolio.
The ZAPF said members should indicate how much they can contribute towards financing the programme by end of August this year. Command agriculture is part of the Government’s comprehensive measures that it is coming up with to enhance food security.
The programme involves identifying competent maize farmers, who would be given inputs, irrigation and mechanised equipment. The farmers, to work under strict supervision will be required to commit five tonnes per hectare towards repayment of inputs.
The programme will ensure Zimbabwe becomes self-reliant in terms of food requirements.
The challenges related to unpredictable rainfall patterns due to climate change demand that the country invests in irrigation schemes and maximise on the use of existing and new facilities.
As such, the Government will distribute irrigation equipment being acquired from Brazil under the $98 million loan facility provided by the South American country to support farmers.
The equipment, which also includes tractors and fertiliser spreaders was launched by President Mugabe in May last year and will help the Government fulfil targets under the Food and Nutrition cluster in the ZimAsset, the country’s medium economic program.
Previously, pension funds have participated in various national projects, including agriculture and infrastructure development. This year, Zimbabwe imported grain worth several millions of dollars to mitigate the impact of the drought which hit several countries in the region.