Farmers’ Unions Hail Land Tenure Reforms As Game-Changer For Agricultural Sector

Farmers unions have welcomed the changes to the country’s land tenure system that were announced by the government on Tuesday.

Under the reformed system, beneficiaries of the land reform programme will now receive a bankable, registrable, and transferable document of tenure from the government.

The government said that these adjustments will unlock the full value of the land and boost the country’s overall economic performance.

In an interview with The Herald, the Zimbabwe Farmers Union (ZFU) Secretary General said the new model will enable farmers to access capital from financial institutions. Said Zakariya:

I think this settles a matter that has been long outstanding, the need for farmlands to be used as security for all agricultural borrowings or for borrowings related to farm development, including agricultural production.

So, over the last two decades, farmers were securing loans using properties outside the farmlands and that was not sustainable.

Number one, because of the size of the borrowings for instance, if you are using a house, that house would not secure a long-term asset.

So, before, the values were very low, because the assets outside the farms were also not carrying so much, you can imagine someone using their house in Budiriro to develop a commercial farm somewhere.

The transferability of land gives comfort to financiers, that if anyone, by any means, defaults on their loans, the bank now has a fallback, which means the debt can actually be financed by somebody else and the firm then transfers ownership to whoever may have financed the debt.

So, this is a game changer in terms of unlocking value on our land under the Land Reform Programme. And indeed other lands too. They had lost the value completely. They had zero value. Now, this restores value, the value of land.

Zimbabwe Indigenous Women Farmers Association Trust (ZWIFAT) president Depinah Nkomo said the new land tenure system will allow farmers to develop infrastructure on their farms. She said:

Now we will be very confident especially us women because we will be able to access financing and we will also be able to transfer ownership as stipulated.

Before this development, we were not even confident to build proper infrastructure on our land so the President has heard our cry and as women, we are very happy we can now start our projects confidently and freely because we will now have that security.

Economist Prosper Chitambara, speaking to NewsDay, said the changes to the land tenure system are important not only for the land itself but also for Zimbabwe’s broader economic development. He said:

I think it is critical in terms of ensuring the productive utilisation of the land and also unlocking full value, private sector investment and finance from private financial institutions while allowing land to be transferable.

That is one of the things a lot of scholars and observers have been advocating. I think that is the way to go to unlock the full value of land in Zimbabwe.

Bankers Association of Zimbabwe (BAZ) president Lawrence Nyazema said that while the new land tenure system provides farmers with more secure and transferable land rights, banks will still need to see evidence of sound business plans and the ability to generate steady income streams. Said Nyazema:

Land is not as collateral that a farmer can walk into a bank requesting a loan because he or she has land. A farmer must have a project that generates money.

It is very difficult for a farmer to just approach a bank and ask for money just because they have the land. If he or she fails to pay for the loan, the bank should be able remove them from the land.

It is prudent for the farmers to come up with project proposals that they can develop to make sure that they are able to access the funds and repay the loans.

More: Pindula News