Infrastructure gap – A potential investment area.

Infrastructure gap – A potential investment area.

Financial Gazette

6/2/2020

THE government must work on a comprehensive approach to revamp infrastructure in the agri­cultural sector especially in communal areas as this will create an enabling environment for investment through value chain financing models, The 2018/2019 Agriculture Sector Survey, has said.

The survey commissioned by The Financial Gazette and the Zimbabwe Agricultural Society and conducted by the Africa Economic Development Strategies noted that poor agricultural infrastructure had adverse effects on farming activities but also presented investment op­portunities for government as well as private players.

“It is important that the government works on a com­prehensive approach to revamp infrastructures in the agricultural sector in Zimbabwe. In this approach, it is important that government create an enabling environ­ment for private sector to invest in agriculture through tax incentives.

“The government …, as part of its capital expendi­ture should consider investing in physical infrastructure in the farms by putting more emphasis on communal farmers who were found to be unproductive and funds used in Command Agriculture can be earmarked for this exercise,” the survey said.

It noted that there was inadequate development, rehabilitation and modernisation of agricultural infra­structure across all categories and this contributed to­wards low productivity and production, and ultimately competitiveness.

“Investment in irrigation infrastructure has not been realised over the past years and some of the infrastruc­ture availed through government programmes lies idle at farms. A poor schedule for repairs and maintenance has left the sector with little functional irrigation equip­ment,” the study reported.

According to the Ministry of Lands, Agriculture, Water, and Climate Development, of the 39,6 million hectares of land in the country, about 42,1 percent is utilised for agriculture, with about 365 000 hectares of land suitable for irrigation.

However, less than 50 percent of this is currently equipped with irrigation. About 123 000 hectares is currently irrigated mostly by commercial fanners and smallholder irrigation projects, yet the country has the potential to irrigate two million hectares of land.

“The utilisation of existing water bodies, under­ground water and trans boundary water bodies such as Zambezi River and Limpopo River can make a sig­nificant contribution to food security and agricultural growth in the country, especially during drought peri­ods.

“However, the available water bodies are currently under-utilised, mainly due to lack of investment in irri­gation development, rehabilitation and modernisation.”

Also, information gathered during the survey indi­cated that for the agricultural sector to prosper, there should be an established road network to ease the trans­portation of inputs and produce.

“In that regard, respondents suggested that a road fund be established for rehabilitation and maintenance of farm strip roads and communal roads and construc­tion of new roads in newly-resettled areas.

“It is important for stakeholders in the sector to pri­oritise investment in infrastructure to provide a stable foundation for the future growth of the sector,” the sur­vey said.

Besides the road network and the irrigation infra­structure, the survey also highlighted how the limited access to agricultural machinery and implements were compromising the timeliness of farm operations.

For instance, the current national requirements for, tractors and combine harvesters stands at 46 000 units against the available 14 000 tractors, while 400 combine harvesters are required yet the country has 300 units only.

“From this perspective, there is scope for investment into the mechanisation of the agricultural sector in Zim­babwe.”

The survey suggested that the country’s infrastructure gaps which ranges from deficits of irrigation equipment, combined harvesters, tractors, roads, silos, rehabilitation of dams can be financed through government’s own ini­tiatives and public-private partnerships.