By Vita Angula
RECENT newspaper reports have brought to the forefront how emerging farmers in Namibia have been caught between a rock and a hard place which can be attributed to a number of factors that include, but are not limited to, the drought experienced in the country during the past three years.
Agribank’s strict stance on the repayment of loans which have been advanced to farmers, regardless of the economic, social and climatic conditions experienced within the country and the oversight by the Agribank which they have acknowledged as a failure to align the loan repayment cycle of farmers with the cash flow cycle of the funded projects (farms) despite the principle source of income for paying back the loans being the funded projects (farms) has proven to be a serious bone of contention that has led to an impasse between the affected farmers and agribank.
The primary purpose of Agribank according to its mission statement is to provide affordable and sustainable innovative financial solutions towards socio-economic development in Namibia with one of the main functions of its board being stated as, the duty to “implement mechanism to safeguard the interests of the bank and its stakeholders.”
The past three years have seen Namibia experience severe drought which affected all spheres of society but none have suffered the brunt of these extreme, undesirable climatic conditions than our farmers who are the back bone of our society in terms of food production, employment creation, and contribution to the Gross Domestic Product (GDP).
It is important to highlight that agricultural production is the main source of food with which we cannot live, and so goes an Argentinian quote that -“At least once in a lifetime you will need a doctor, a lawyer, an architect – but every day, three times a day, you will need a farmer!” one of the biggest employers in the country, a country which is already burdened with high unemployment and regardless whether there is drought or not farmers do not lay off their permanent workers but dig deeper and continue to work the land even in the face of reduced harvests. Agriculture contributes 5percent to the GDP of the country, however factoring in subsistence agriculture the figure translates to approximately 45 percent of Namibian’s depending on agriculture for their livelihood. What message is Agribank giving to the rest of society when despite the tough climatic conditions the country has faced over the previous three years they still demand payments of loans disregarding the fact that optimal production has not taken place?
The Agribank board defines one of its objectives as being the development and implementation of mechanisms to safeguard the interests of the bank and its stakeholders. However, the board seems not to be fulfilling this mandate because the banks interests in terms of survival by recouping loans is executed without considering the negative and detrimental effect it has on the most important stakeholders which are the farmers. To add fuel to the fire the bank roped in the services of external debt collectors who left no wheel unturned, with only profit in mind these ‘vultures’ have listed the already strained farmers on ITC a credit bureau that essentially makes it impossible to get credit in the future. This harsh recourse given the above mentioned circumstances is a gross injustice to the farmers, their families, their employees and the nation at large.
According to their most recent annual report, Agibank admits that they ‘foresee another challenging two to three years ahead as climatic conditions remain volatile and unpredictable. Given this forecast it is only reasonable and just that they not take such a harsh approach to emerging farmers but rather meet them halfway in navigating through these trying times.
There is a widely accepted practice worldwide even in the so-called free-market economies for governments to provide subsidies to their farmers given the pivotal role they play in any economy.
Agribank and its leaders should understand that farming is not the insurance businesses of Namibia that are headquartered in South Africa with a huge pool of financial resources. Farming is back-breaking work that requires dedication, sacrifice, time and money and even in instances when a farmer has put all measures and efforts in place he still depends on the goodwill of nature to ensure a harvest.
It is with this in mind that I propose that Agribank, as a parastatal, heed the call of all peace-loving farmers in Namibia to review its current stance on the repayment of loans by re-adjusting the repayment periods and aligning the loan repayment cycle to a projects cash flow cycle.
Vita Angula is a socio-politico commentator and part-time farmer in the Mangetti area of northern Namibia
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