‘Horticulture needs long-term funding’

19 Nov, 2021 - 00:11 0 Views
‘Horticulture needs  long-term funding’ Players in horticultural production say the sector requires long term financing to be viable

The Herald

Michael Tome Business Reporter

PLAYERS in horticulture production have called for long-term financing schemes  to support the sector, which entails crops that need time before they start paying back.

Zimbabwe holds huge potential to supply global markets with horticultural produce but many players in the sector excluding big corporates, have struggled to grow their output due to funding issues.

The funding restraints have predominantly been due to a financial sector that does not have flexible conditions when granting agriculture-related loans, let alone long-term financing.

A number of horticulturists have since  resorted to companies that offer contract farming to small and large-scale farmers, which is seen as more profitable and sustainable. Zimbabwe exports citrus fruits including oranges, grapefruit and lemons as well as subtropical fruits, which include bananas, mangoes, passion fruit,   and deciduous fruits like peaches, apricots, plums, nectarine, apples, and pears.

Horticultural products require in excess of four years and others like plum trees begin bearing fruit in a period between four to six years after planting; hence the need for flexible long loan terms that give farmers ample time to grow and produce.

Zimbabwe Agricultural Development Trust (ZADT) chief executive officer Godfrey Chinoera said most in the horticulture sector did not possess adequate capital or strong balance sheets to scale up their operations.

“We need funding designed for long-term investments including new activities and initiatives. Most of the horticulture industry players do not have adequate capital or strong balance sheets to scale up or partake in long-term investments, regardless of what you do, balance sheets are limited to a certain amount of money unless you complement it by maybe equity or other investors.

“We need to have better investment into the sector so that we promote the growth of new activities,” said Mr Chinoera while speaking at the recently held Zimbabwe Horticultural Development Council investment forum.

Mr Chinoera also said there was a need for funding directed towards skills development and retention in the sector in order to avoid skills flight in the sector.

“One of the key aspects which may not be taken as direct funding into operations is the funding of skills development in horticulture,” he added.

According to Dr Maxwell Mutema,  an agriculture practitioner, responsible authorities should work on coming up with a policy framework or structures designed to enhance horticulturists’ eligibility to accessing long-term funding if the country is to realise tangible growth from this lucrative industry.

“I think it is on policy plan that we have a big elephant in the room, otherwise there is a lot of money out there which is willing to come into this country especially to support export horticulture, high-value horticulture, and value addition to horticulture,” said Dr Mutema.

Horticulture is a key aspect to Zimbabwe’s economy and the government through ZimTrade and other trade bodies are pushing for growth in the sector where they intend to contribute significantly to the country’s economy.

According to ZimTrade Zimbabwe’s horticultural exports receipts in 2020 reached US$111 million. The majority of Zimbabwe’s horticultural exports go to the Netherlands, United Kingdom, and South Africa while the United Arab Emirates (UAE) takes two percent of this total cost. UAE’s total fruit import bill stood at US$2, 4 billion in 2018, last year alone the country acquired US$905 000 worth of Zimbabwe citrus exports.

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