THERE has been a low default rate on the repayment of loans under Zimbabwe’s Belarus-sponsored farm mechanisation programme, a government official has said.
The programme has so far seen the deployment of equipment worth more US$60 million.
The director of agricultural engineering, mechanisation and soil conservation in the ministry of Agriculture, Edwin Zimunga, recently told The Financial Gazette that the majority of the loans in the revolving facility had been repaid.
“In terms of payments, we have seen a significant improvement and 98 percent of loans that were given under the farm mechanisation facilities have been performing with commitment from the remaining two percent to perform,” he said.
“It has been quite incredible because farmers have taken that stance where they now understand that for us to have a revolving fund in terms of mechanisation whoever accessing the equipment through the banks is making their timely payments.
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“Through a stop-order facility under the mechanisation development alliance, we realise that it’s easier for the farmer to commit and make the payments without having to necessarily procrastinate and have a lot of anxiety when it comes to their payments.”
The Belarus farm mechanisation scheme was a project implemented by the Zimbabwean government in an attempt to boost agricultural production in the country.
The agriculture sector contributes about 17 percent to the country’s GDP.
Despite the uneven start and distribution of rains during the 2022-23 summer season, the latest assessment showed prospects for high yields, with maize production expected to be 58 percent ahead of last season’s output at 2 298 281 metric tonnes.
In light of this, the government says Zimbabwe’s GDP is now expected to increase from the current projection of four percent to six percent “on account of the positive performance of the agricultural sector”.
Analysts have, however, urged the government to moderate its economic optimism on account of the bumper harvest expected this year after a positive second crop assessment.
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