Synergies for Growth – Cooperate. Collaborate. Complement.
ZIMBABWE AGRICULTURAL SOCIETY
By Dr A J Masuka, Chief Executive Officer, Zimbabwe Agricultural Society
Every year, since 2016, as part of a broader transformation strategy to rally consensus, and to bid and unite support for the wider cause of agriculture and to complement stakeholder efforts towards agriculture-led accelerated economic development, the Zimbabwe Agricultural Society chooses an annual theme. Last year the theme was “Technology. Innovation. Modernisation: Adopt Accentuate. Accelerate”. For the year 2020, the theme is “Synergies for Growth: Cooperate. Collaborate. Complement“.
The theme supports the resource-based strategy adopted for the country’s accelerated economic development towards Vision 2030. The strategy’s emphasis is on agriculture, mining and tourism. These are certainly our biggest natural endowments forming the pillars of this accelerated socio-economic developmental path. And manufacturing, infrastructure and services are key supportive pillars, primary enablers and principal co-factors for this development.
2.0. Sustainable and Inclusive Economic Development.
Over 70 percent of the population depends on agriculture for survival and sustenance. A deliberate and national focus should, therefore, be given to this important sector. The majority of the 70 percent 54 percent of them being women, live in poorly developed rural areas, where only 64 percent have access to clean water and less than 30 percent have access to suitable sanitation facilities.
Our take is that Vision 2030 must prioritise the 1.6-1.8 million rural households, some 10 million people, to uplift their socio-economic status, in a holistic manner, addressing housing, water, sanitation, infrastructure, and social services, among others. Their only credible avenue out of poverty is increased agricultural productivity, yet there is a paucity of practically funded ideas about “what and low” to do this! The startling statistic that a mere 5 percent of rural households have surplus production to sell annually, must allow evidence – based policy making to take centre stage. With a focused, practical, inclusive and sustainable rural agricultural development paradigm shift, we see synergies for growth.
An estimated 60 percent of raw materials used in the manufacturing sector originate from agriculture, so a robust manufacturing sector, that is competitive in the local, regional and international markets, must, of necessity, be based on a vibrant, cost-efficient, profitable and sustainable agricultural sector. Yet the actors in this two sectors – agriculture and industry – both private and public, believe and act like they are in competition with little cooperation, collaboration and complementarity to yield the desired synergies for growth.
3.0. The Agricultural Development Pentagon
We have previously proffered the Agricultural Development Pentagon, to illustrate the links and the actors for a “new agricultural dispensation” cognisant of, and in the context of, the realities brought about by the land reform programme. This is a clear and simple workable approach to increasing crop and livestock production and productivity devoid of impression amplifiers.
3.1. Farmer-Centred
This Agricultural Development Pentagon illustrates the need to establish farmer-centred and working value chains for inclusive and sustainable development This would entail a new capacitation paradigm shift from extensionists to business advisors, translating and sharing the burden of farmers success in agriculture as a business to both the farmer and the business advisor (AGRITEX), in communal and resettlement areas and with dedicated advisors for A2 farmers for production and financial plans. A policy shift would buttress and complement this thrust This shift entails a radical change in the whole education value delivery continuum – from tertiary institutions to agricultural colleges for students, to agricultural business schools for farmer knowledge translocation and sharing. A richer mosaic of knowledge generation, translocation and sharing is required.
3.2. Political Will
It starts with the right policies, and enabling regulations, for which political will must be strong. Avoiding policy-induced droughts through appropriate agro-ecological region-defined input crop and livestock support schemes, removing the burdensome regulatory issues, and streamlining and harmonising levies across the country, should be routine. We have seen some positive change, and some green shoots with the distribution of traditional grains across the country more recently.
The greatest changes have to occur in the policy and regulations domain to drive sustainable agriculture.
3.3. Elusive Financing Regime
The transition from Command Agriculture to Smart Agriculture allows farmers who have fully paid their loans to access inputs and seasonal finance from some banks, for the 2019/20 season. These seasonal loans have a government guarantee for obvious reasons. The effort is focussed on the 16 000 A2 fanners, and some eligible Al farmers, but excludes the majority of farmers-the 145 000 A1 and 1.6 – 1.8 million rural households who continue to only receive seasonal input packs from government. They do not have a funding window, unlike in the past when they could borrow as a group from the Agricultural Finance Corporation.
The available seasonal funding excludes funding for equipment and infrastructure and other important capital developments for the farm. A more sustainable and inclusive financing model should be found. A model that does not necessarily focus on the 16 000 A2 and large scale commercial farmers, but a model that can be sensitive to the requirements of over 145 000 Al farmers, and a model that is sympathetic to the 1.6 million rural households. A model that allows for borrowing for capital projects, for irrigation development, for equipment purchase, for infrastructure construction and rehabilitation, and a model that is sensitive to the risk profile in agriculture. Perhaps a model that is not perfect. Perhaps a model that only optimises the value chain. A model that does not necessarily lead to maximisation, by value chain actors. Such a model requires a dedicated Land Bank] for registration of all permits, leases and offer letters “as collateral”, ware-housing receipts, and providing seasonal and developmental loans based on offer letters, backed initially by government guarantees. A path away from the melodrama of insouciant and mutating funding models towards a modicum of stability and predictability.
Should we not ease the burden of farmers and declare at policy level that these offer letters are as good as 99 year leases. One of the requirements of a 99 year lease is a five – year production record for which the majority of farmers do not haye as there has not been a funding model that has lasted five years, to capacitate all the farmers in the first instance.
3.4. Ramping Production and Productivity
The case for tobacco is compelling. Following disruption during the land distribution era from 2000 to 2002, and in the absence of collateral by farmers, production has increased from a low of 48 million kg in 2003, to a peak of 265 million kg in 2019. Borrowing by tobacco merchants who support farmers with inputs, training and cash-flows, and guarantee purchase of the commodity is made viable by strong regulatory frameworks. This strong production has spawned opportunities for business along the value chain, from research and development, seed production, fertiliser, crop chemicals, consultancy services, to banking, irrigation, curing, cigarette-making and sales businesses. This phenomenal increase in tobacco production is undergirdled by a strong network of legislation and regulations imposed by government. We can replicate this model, albeit with modifications.
3.5. Value Chains and New Business Ecosystems
An ecosystem of opportunities has been created in the tobacco industry, indeed spurring synergies for growth of the industry. While growers receive some USD700 million annually, the industry and support services, are clearly a USD 1 -1.5 billion-dollar industry. A visit to tobacco sales floors demonstrates the hive of activity and the SMEs that have been created to respond to farmers1 needs, yet even these visible entrepreneurial episodes are nascent and have yet to be harnessed for the growth potential they hold, if structured and formalised.
3.6. The Climate Change Story
Climate change ravages communities now more regularly than ever before in the history of our nation. Curiously, with 9 818 darns of various shapes and sizes and in different states of repair/disrepair in Zimbabwe, we seem not to have a master national irrigation strategy and plan which are a must for sustainable and inclusive agro-based rural socio-economic development.
We should shy away from statistical pitfalls of projecting lost potential but instead focus on a more realistic assessment of opportunities. Perhaps the biggest impact on agricultural production will be a combination of policy directing behaviour and rewarding outputs that “climate proof” agriculture. A new water philosophy should guide our thinking, our planning and, consequently, our actions.
3.7. A New Value Frontier
Despite exporting largely semi-processed tobacco worth some USD1 billion, Zimbabwe does very little value addition of this product. Imagine the numbers, there is perhaps 10 times more value of tobacco, as cigarettes. So why can this not be a USD 10 billion industry by 2030 for which we could lay the foundation stone now? With cooperation, Collaboration and complementary efforts, we see a tapestry of synergies for growth in value addition .and beneficiation, marketing, transport, logistics, and service sectors, among others.
3.8. Learning and Opportunities
The history of agriculture in Zimbabwe, for convenience from 1924 when the Land Bank was established, is replete with examples of successful synergies for growth. This thrived on strong cooperation among actors depicted in the Agricultural Development Pentagon, a commitment to collaboration among actors, and strong complementary development and deployment of necessary supportive frameworks.
There are lessons to be learnt for the not so successful stories with other value chains, principally, wheat soya bean, maize, groundnuts, and horticulture. In commercial broiler and pig production, there are now local off-take arrangements that have emerged to fund and grow the production base. It is pleasing to note that we have begun to see some semblance of a value chain financing arrangement, akin to the one that led to a close relationship between farmers and Cold Storage Commission in the 1980s’and 1990s, and that akin to the maize boom of the 1990s by communal and small scale farmers based on strong linkages among farmers, the Agricultural Finance Corporation and the Grain Marketing Board. A combination of logic and good intentions should manifest in this critical space.
For export markets, strong value – chain financing is emerging in the popular macadamia nuts. The sugar industry, too, has a very strong foundation for growing its value chain, albeit with a few trust-based challenges, among the actors.
4.0. Agriculture 4.0 Yields Industry 4.0,: “The New Normal”
Imagine a robust and credible financing system for agriculture leading to sustainable intensification of production and increased yields of quality, competitive agricultural produce and products, feeding into a modem industry system primed for competition. A nexus with strong and rich ingredients of innovation, technology and modernisation. This synergy for growth must be highlighted continuously. But we require cooperation among actors. We require increased collaboration within and among value chains. We require consolidation of these activities to anchor growth, towards vibrant agricultural and manufacturing industries, giving further opportunities for growth in infrastructure, in energy, in services, and in increased local and international trade.
These are the “Synergies for Growth” away from adjunct and disjointed approaches with morbid fascination for growth, but lacking in the fundamentals. We should foster innovation, collaboration and value creation with both purpose, and passion, by aligning agriculture and manufacturing value chains, and then scaling them for accelerated growth.
5.0. Farming Crops, Trees, Game and Minerals: “The Next Normal”
Devolution should be an opportunity for communities to assert themselves to start and grow their local comparative advantage resource-endowments and enterprises to “export” to other parts of the country and beyond. A rural value chain and aggregator model for mobilising the 1.8 million households to produce road runner chickens and indigenous goats for “export”, bananas from Honde, Harurwa from Bikita, macimbi for Matabeleland South, pine apples from Chipinge, game from conservancies and parks abutting various communities, are good examples. We may think that some things are unchangeable and unchanging, or are these just feelings disguised as facts.
The exodus of young Zimbabweans from farming communities, often in rural areas, lured by mining for gold, chrome and other metals is revealing. With coordination and formalisation, a dual agricultural and mining economy can be a source of their success and could spur accelerated rural development as proceeds are spend in local communities. These are synergies for growth for which cooperation, collaboration and complementarities are required among actors in agriculture, in mining, in tourism – the resource sectors, primarily.
6.0. Conclusion
The Zimbabwe Agricultural Society’s mandate was redefined in 2017 to re-focus on promoting agriculture and its supporting activities and to facilitate agricultural development that ultimately impacts positively on rural livelihoods, especially for women and youth.
The theme for 2020 seeks to highlight the need to harness and align national efforts towards sustainable agricultural production for national food self-sufficiency, amidst recurrent droughts, climate change and disjointed efforts by actors in the agricultural value chain and supporting ecosystems. A vibrant agricultural sector leads to a vibrant and competitive manufacturing base, and breeds opportunities for growth in infrastructure, tourism, and services, while complementing resource exploitation activities, as the majority of miners, by head count, are actually agriculturalists first.
We, therefore, must seek out “Synergies for Growth” and “Cooperate, Collaborate and Complement” with each other, at individual and collective levels, and in household, community and national spaces, to accelerate national socio-economic transformation.
7.0 Logo
ZIMBABWE AGRICULTURAL SOCIETY
The Zimbabwe Agricultural Society’s 2020 theme icon, whose hallmarks are a green leaf merged with a solar panel, a green factor}’ and sturdy shapes formed with a combination of a miner’s helmet, battery and gear, captures perfectly the organisation’s desire for the creation of cross industry cooperation and unity of purpose as the country comes to grips with climate change and the need for eco-friendly strategies to combat its effects.
The merger of the green leaf with a solar panel symbolises the standards of renewable energy that the ZAS advocates for at a time awareness of climatic instability is rising, while the green factor}’ showcases the Society’s eco friendly stance which is underlined by the fact that it emits biodegradable gas, instead of eco-hazardous toxic fumes, which bellows from the factory’s outstanding lime tower. The alignment of the miner’s helmet, battery and gear suggests the perfect synergy between various players that the organisation aspires towards.