Agricultural Policy in Agricultural Policy in

Zimbabwe During the Crisis Zimbabwe During the Crisis

and Beyond: Issues and and Beyond: Issues and

PolicyPolicy

Dr. I. Dr. I. MatsheMatshe, HSRC & UZ, HSRC & UZ

BackgroundBackground

�� Agricultural sector has the potential to make a Agricultural sector has the potential to make a significant contribution to economic growth and significant contribution to economic growth and poverty reduction. poverty reduction.

�� Ag. was ZimbabweAg. was Zimbabwe’’s economy and will continue s economy and will continue

to be so for the foreseeable future.to be so for the foreseeable future.

�� review of domestic agricultural performance review of domestic agricultural performance shows that government has had only shows that government has had only limitedlimited, , shortshort--livedlived successes in improving successes in improving performance of the sector in achieving growth performance of the sector in achieving growth goals on a sustainable basisgoals on a sustainable basis

Agricultural output growthAgricultural output growthAgricultural Output Growth 2001-2006

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

2001 2002 2003 2004 2005 2006

Year

Per

centa

ge

%

Agric Output

0

50

100

150

200

250

300

350

400

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Infla

tion

(%)

-10-8-6-4-2024681012

GD

P (%

)

Avge Annual Inflation Rate GDP Growth rate

contcont

� Before 2006 sector was largely dualistic � Poverty prevalence also follows this structure, with high prevalence in the family based, subsistence sector (mostly in poor agro-ecological regions)

494922222929Urban AreasUrban Areas

242418185858Small Scale commercial farmsSmall Scale commercial farms

292930304141Large Scale Commercial farmsLarge Scale Commercial farms

7718187575Communal LandsCommunal Lands

NonNon--

Poor(%)Poor(%)PoorPoor

(%)(%)

Very Poor Very Poor

(%)(%)Sectional ClassificationSectional Classification

Agricultural Performance Agricultural Performance

�� Agricultural production in Zimbabwe varies dramatically Agricultural production in Zimbabwe varies dramatically from year to year according to rainfall from year to year according to rainfall

�� From 1999 production slumped to below levels of the From 1999 production slumped to below levels of the mid 1980s, with major fluctuations in production mid 1980s, with major fluctuations in production according to weather conditions. according to weather conditions.

�� Official figures, though, show that between 1982Official figures, though, show that between 1982--4 and 4 and 1996 the real value of production in communal areas 1996 the real value of production in communal areas grew by 40%, compared to 35% in the commercial grew by 40%, compared to 35% in the commercial

�� Distinct reversal of this trend in the crisis period Distinct reversal of this trend in the crisis period -- real real value of production fell by 33% (CSO, 2006).value of production fell by 33% (CSO, 2006).

�� What role climate change and/or economic crisis?What role climate change and/or economic crisis?

Consider maize output v rainfallConsider maize output v rainfall

Maize Production Trends

0.0

5.0

10.0

15.0

20.0

25.0

30.0

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

Harvest Years

Pro

duct

ion

(met

ric

tonn

es) i

n 00

,000

s

National

Commercial

Communal

Rainfall Pattern 1901Rainfall Pattern 1901--2002 2002

Rainfall Amount from 1901 to 2004 (mm)

0

200

400

600

800

1000

1200

140019

01/0

2

1905

/06

1909

/10

1913

/14

1917

/18

1921

/22

1925

/26

1929

/30

1933

/34

1937

/38

1941

/42

1945

/46

1948

/50

1953

/54

1957

/58

1961

/62

1965

/66

1969

/70

1973

/74

1977

/78

1981

/82

1985

/86

1989

/90

1993

/94

1997

/98

2001

/02

Rai

nfa

ll (m

m)

Land Distribution and PolicyLand Distribution and Policy

�� Land Reform and ResettlementLand Reform and Resettlement

-- initial phase: independence to 1985initial phase: independence to 1985

-- 22ndnd phase: 1985, until 1990, includes phase: 1985, until 1990, includes

aspects of the period up to 1997aspects of the period up to 1997

-- 33rdrd phase includes the crisis period 2000 to phase includes the crisis period 2000 to

the present timethe present time

Lessons from the Resettlement Lessons from the Resettlement

Exercises Exercises

�� in the absence of a huge inflow of aid funds to in the absence of a huge inflow of aid funds to support service provision to resettled farmers, support service provision to resettled farmers, government levels of support will mean government levels of support will mean agricultural production levels to remain below agricultural production levels to remain below prepre--1999 levels for a decade or more under the 1999 levels for a decade or more under the current framework. current framework.

�� Some authors contend that there have been Some authors contend that there have been significant increases in production by resettled significant increases in production by resettled farmersfarmers

�� differentiate the targets for resettlement differentiate the targets for resettlement according to natural regionaccording to natural region

Land tenureLand tenure

�� With land reform, former commercial farmland, With land reform, former commercial farmland, the land tenure system changed from freehold the land tenure system changed from freehold to state, communal and poorly defined leaseholdto state, communal and poorly defined leasehold

�� Comparing commercially subComparing commercially sub--divided farms to divided farms to resettled A1 & A2 farmersresettled A1 & A2 farmers’’ investment decisions investment decisions shows a detrimental impact of perceived shows a detrimental impact of perceived insecurities of the tenure regime during crisisinsecurities of the tenure regime during crisis

�� To deal with issues of tenure & financing To deal with issues of tenure & financing security, late in 2006 government developed a security, late in 2006 government developed a system of permits (& 99system of permits (& 99--year leases)year leases)

Irrigation and Water PolicyIrrigation and Water Policy

�� By 2003 there were an estimated 198 irrigation By 2003 there were an estimated 198 irrigation schemes in the smallholder schemes in the smallholder

�� However, good performance depends on:However, good performance depends on:

-- Active farmer involvement in scheme Active farmer involvement in scheme planning and managementplanning and management

-- Cultivation of high value crops, which can be Cultivation of high value crops, which can be grown throughout the year;grown throughout the year;

-- supporting infrastructure, especially roads, to supporting infrastructure, especially roads, to facilitate scheme links with markets facilitate scheme links with markets

�� Few initiatives have been undertake to enhance Few initiatives have been undertake to enhance performance of irrigation scheme in the crisisperformance of irrigation scheme in the crisis

Marketing of Agricultural Marketing of Agricultural CommoditiesCommodities

�� Role of marketing boards & Role of marketing boards & gvtgvt

interventionintervention

�� Role of the market and Role of the market and liberalisationliberalisation

-- commercial sectorcommercial sector

-- smallscalesmallscale sectorsector

-- rural enterpriserural enterprise

Agricultural Support Services Agricultural Support Services

�� in the 1990s real government spending on all agricultural in the 1990s real government spending on all agricultural services in general and those of services in general and those of AgritexAgritex in particular in particular --““by 1994/95 real per capita spending on agricultural by 1994/95 real per capita spending on agricultural support services was 26% lower than the peak in support services was 26% lower than the peak in 1990/911990/91””

�� Agricultural Research Agricultural Research

�� Agriculture Finance Agriculture Finance –– pvtpvt & & gvtgvt-- Early 1990s AFC was Early 1990s AFC was ““commercialisedcommercialised””

-- late 1990s AFC divided into late 1990s AFC divided into AgribankAgribank and a softand a soft--loan company loan company (ADAF) which aimed to increase lending to poor households (ADAF) which aimed to increase lending to poor households primarily in communal areas primarily in communal areas –– role later taken over by RBZ role later taken over by RBZ

-- FIsFIs and banks continued to provide financing to farmers during and banks continued to provide financing to farmers during the crisis as conduits of preferential funding the crisis as conduits of preferential funding

-- smallholder producers also gain access to credit through smallholder producers also gain access to credit through contract farming and contract farming and outgroweroutgrower schemes schemes

Agricultural Inputs Agricultural Inputs

�� Became one of the best seed distribution Became one of the best seed distribution sysytemssysytems in Africain Africa

�� Setting up marketing channels for seeds in Setting up marketing channels for seeds in rural areas is expensive. In addition, the rural areas is expensive. In addition, the sector as a whole suffers from inconsistent sector as a whole suffers from inconsistent and poorly enforced government and poorly enforced government regulations regulations

�� recent years has involved the GMB and recent years has involved the GMB and the cotton companies the cotton companies

LivestockLivestock

�� National herd depleted by chaos and National herd depleted by chaos and blantantblantanttheft during land seizurestheft during land seizures

�� Vet. Provision hamperedVet. Provision hampered

�� GvtGvt rere--stocking schemes insignificantstocking schemes insignificant

�� Livestock crucial for Livestock crucial for ssss as an productive asset as an productive asset and store of value in all parts but crucial output and store of value in all parts but crucial output for parts of Midlands & Matfor parts of Midlands & Mat

�� ending of ending of subsidisedsubsidised, compulsory cattle dipping , compulsory cattle dipping and vaccination services lead to lower livestock and vaccination services lead to lower livestock survival rates and less investment in cattle survival rates and less investment in cattle

Drought, and Central Bank QuasiDrought, and Central Bank Quasi--Fiscal ActivitiesFiscal Activities

�� 2004 2004 -- Agricultural Supply and Production Agricultural Supply and Production

Enhancement Facility (ASPEF)Enhancement Facility (ASPEF)

�� Operation Operation MagutaMaguta -- production production

programmeprogramme of the Zimbabwean Army of the Zimbabwean Army

(GOZ, 2004) (GOZ, 2004) -- not clear what criterion was not clear what criterion was

used to identify used to identify MagutaMaguta landland

�� Future Future –– amendment bill amendment bill shldshld strip away strip away

the temptation of CB to be involved in QA the temptation of CB to be involved in QA

The Rural NonThe Rural Non--farm Sectorfarm Sector

�� considerable rural nonconsiderable rural non--farm sector farm sector -- little data little data exists to show true contribution exists to show true contribution

�� Mining (mostly illegal or informal), art, craft, Mining (mostly illegal or informal), art, craft, informal manufacturing and trade played a huge informal manufacturing and trade played a huge role in diversifying the livelihood strategies of role in diversifying the livelihood strategies of the rural populations the rural populations

�� role of remittances (both local and international) role of remittances (both local and international) extremely important extremely important –– more research neededmore research needed

�� facilitative service provision crucialfacilitative service provision crucial

�� Empirical work Empirical work –– incrincr agag. output, . output, incrincr incomeincome

Post Crisis Recovery Post Crisis Recovery

Scenarios/SuggestionsScenarios/Suggestions

�� Finality to land redistribution unavoidable in any proFinality to land redistribution unavoidable in any pro--poor growth strategypoor growth strategy-- under and under and unutilisedunutilised land to be brought into production firstland to be brought into production first

�� tenure and property rights need to be clarified tenure and property rights need to be clarified

�� support service provision to communal & resettled support service provision to communal & resettled farmers farmers

�� public investment in research public investment in research -- & cash & cash vsvs food cropsfood crops

�� normalcy in the operations of agricultural support normalcy in the operations of agricultural support institutions and government institutions and government

�� Farmer finance Farmer finance

�� See Annexure 1See Annexure 1

Conclusion Conclusion -- Priority policies Priority policies

FinanceFinanceTenure Tenure –– longlong--termterm

Duality?Duality?

MacroMacro--economic stabilisationeconomic stabilisation

StateState’’s roles rolehumanitarian plan (for 2010)humanitarian plan (for 2010)

MarketingMarketingintegration of national and district policies for agriculture, conservation and rural livelihoods.

Significant aid package for Significant aid package for

agriculture starter agriculture starter

packs/subsidised fertilizer (to packs/subsidised fertilizer (to

kick start small farming)kick start small farming)

ExtensionExtensionTaxationTaxationInfrastructure rapidly reInfrastructure rapidly re--

developed and extended into developed and extended into

the communal landsthe communal lands

ResearchResearchRole of expert farmers Role of expert farmers

(whites) & other(whites) & otherTenure and property rights Tenure and property rights

securitysecurity

Policies needing lots of Policies needing lots of

technical analysistechnical analysisPolicies needing Policies needing

careful political and careful political and

technical analysistechnical analysis

PoliciesPolicies where the where the

choice is clearchoice is clear

TTDTTD

�� Rapidly collect essential data for policy Rapidly collect essential data for policy and planning. and planning. DataData, , DataData, ,

�� ItIt’’s the s the DataData stupid!! stupid!!

�� Develop synergies with Develop synergies with initiatives/processes/opportunities/actors

�� Frame scenarios for poverty reduction Frame scenarios for poverty reduction from an agriculture/local production from an agriculture/local production approachapproach

�� Migration Migration