Tuesday 11 May 2021
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Agribank shuts door on distraught farmers

Agribank will not suspend the collection of loans owed to it by previously disadvantaged farmers in spite of the ongoing scourge of a crippling drought, Chief Executive Officer Sakaria Nghikembua has said.
Nghikembua exclusively revealed this to The Patriot after some farmers complained that the hard-hitting drought is threatening to thrown their finances into disarray and they may not be able to make good their pledge to pay back monies they took as loans from the agricultural bank.
Said the CEO, “The bank cannot accede to such a request on a wholesale basis. We wish to once again advise our clients to contact the bank and make appropriate repayment arrangements based on their specific circumstances. It is best that such an approach is made early.”
In an interview with a local newspaper last week, the Agribank Chief Executive Officer indicated that the bank was finalising some drought assistance measures and that these will be announced when finalised.  It is however important to underscore that any such measures will be severely constrained by clients’ poor repayment record.
The bank does not have access to unlimited cash resources and solely relies on what it collects back from clients to disburse anew. In the absence of such repayments, the bank cannot make new disbursements.”
Nghikembua’s pronouncement comes at a time when a Crop Prospects, Food Security and Drought Situation report has confirmed that the 2018/2019 rainfall season has been extremely poor and was seen in the forms of delayed onset of the rainfall season, sporadic and erratic rainfall patterns as well as frequent prolonged dry spells.
These were compounded by extremely high temperatures that exacerbated evaporation of the little moisture received.
While this is said to have affected agricultural production and water resources, the report also notes that according to the Namibia Meteorological Services rainfall report, March 2019 was the fifth consecutive month with suppressed rainfall over a large part of the country.
Further highlights are that provisional crop estimates indicated that all crop-producing areas are expecting massive reductions in their harvests.
Aggregate cereal production shows that the country is expecting a substantial reduction in harvest of at least 53% of last season’s harvest and over 42% below the average production.
This reduction is largely attributed to the general poor rainfall received during the 2018/2019 rainfall season.
Nghikembua further came clear as to why the bank has not taken a lead in declaring the drought a national disaster or influencing government to do so.
This is one of the requests the farmers made two weeks ago in their correspondence with this publication. The CEO remarked that it was not Agribank’s mandate to declare a drought in the country, least of all to declare it as a national crisis.
“It is also not the bank’s responsibility to influence the government to declare the drought or to declare it as a national crisis. The mandate to declare droughts in the country lies with the government. Farmers belong to Farmers’ Unions and these would be the correct structures which they should use to lobby government for purposes of declaring a drought in the country.”
“The bank’s mandate is to finance agriculture, including initiatives aimed at coping with the drought, such as providing loans for fodder, water infrastructure, irrigation infrastructure, creating alternative income streams such as wood and charcoal production and similar drought-mitigating measures,” he said. As the drought tightens its grip on the farming community, the farmers reiterated their fear that their farms face possible repossession in the event of failure to pay back the loans.
In the meantime, a ministerial report indicates that grazing conditions continue to deteriorate in most parts of the country in the midst of very poor and below average rainfall conditions experienced countrywide.
Despite the headwinds, the agriculture ministry confirmed that household food security remained satisfactory in most regions of the country, following good improvements in agricultural production recorded in the last two seasons.
“The situation is however expected to weaken as from the next harvest (May 2019) amidst poor crop production referred to above.
Pockets of food insecurity are also still being reported in various areas especially those that suffered poor agricultural production due to prolonged dry spells or floods during the 2017/2018 rainfall season coupled with the current ongoing drought conditions in the country,” the ministries report said.

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