30 May 2018

Namibia: Aussenkehr Farmers Drown in Debt

The struggle by the Orange River Irrigation Project (Orip) small-scale farmers to provide for their families continues as debt eats into incomes earned from their produce.

About 60% of every farmer's profit goes to pay a N$7 million debt they collectively owe the Agricultural Business Development Agency (Agribusdev), which they incurred during the 2015/16 production season.

In addition, 20% of every farmer's profit goes to paying off a debt of N$1,5 million to Agribank.

This means they are only left with about 20% of proceeds from their produce.

These figures were revealed at a meeting Agribusdev convened with the farmers last Thursday at Aussenkehr to share information about profits they had earned for the past production season.

Figures show farmers earned N$1,5 million from their grapes, and received N$624 715 for dates.

It was also revealed that they exported 15 376 boxes of grapes, weighing 4,5kg each, during the 2017 production season, compared to just 5 506 the previous year.

However, the farmers also had their monthly allowances withheld as part of interim measures to reduce their debts.

Agribusdev provides production and marketing services to the farmers, who were trained to set up vineyards on state-owned land measuring 80 hectares, which was allocated to them in 2001, as part of a government empowerment initiative for black irrigation farmers on the Orange River. After the training, each farmer was supposed to sign a 99-year lease agreement. But this did not happen, and instead they each signed a five-year lease agreement in 2009.

Initially, 20 farmers signed the lease agreements to use the state-owned plots for grape cultivation. However, government terminated 10 lease agreements after the farmers sold their produce directly to grape buyers.

Some of the remaining eight farmers at Thursday's meeting complained about not getting adequate income from their produce for years.

"Farmers are starving," Reinhold Mukuve remarked. "Are there no alternatives to help the poor to put food on the table?" he asked.

"We are suffering. Year to year, we are not receiving a cent from our produce. Is this a tactic to get rid of us? How do you expect us to cover our basic needs?" Benzi Tjauira asked the Agribusdev officials.

According to the farmers, some of them were recently pushed to beg for drought relief food for their families.

Information shared with the farmers at the meeting indicated that only five farmers had made a profit from their grapes and dates, with the highest receiving an income of almost N$27 000, and the lowest N$444-44.

Agribusdev managing director Petrus Uugwanga countered concerns about profits by stating that "the thing getting us where we are today is production".

He stressed that the farmers needed to improve their production to see better profits.

Uugwanga further attributed poor profits to what he said was the theft of produce by some farmers to sell directly to buyers, and he warned those involved in this that they risked contract terminations.

"No work, no money. Let us not fool ourselves," he stated as some farmers demanded their monthly allowances back.

He said only those who grow different crops for extra income throughout the year would receive an allowance based on what they produced, and assured them that their produce would be marketed through Agribusdev.

"I am also assessed on how I spend the company's money. Therefore, money should be proportional to the effort you put into your plot," he told the farmers.

Uugwanga also took exception to what he termed defamatory SMSes some farmers were sending to The Namibian, and urged them to follow the right channels before airing their grievances in public.

"We have nothing on record about aggrieved persons, but only read about your concerns in the newspaper SMSes. Only small-scale farmers at Orip feel mistreated," he said.

Uugwanga told the farmers to remain positive about their lease agreements, which expire next year, while they are still trapped in debt.

"The renewal of your agreements will be based on performance," he said, adding that this year's yields look positive.

"Be assured of our support, and let us be positive. No one should fear," he continued.

It also transpired at the meeting that Agribusdev guaranteed 80% of farmers' Agribank loans.

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