Economic consequences of Command Agriculture

In an effort to revive the agricultural sector, government has asked the Reserve Bank of Zimbabwe to print electronic dollars, increasing money supply and flooding the market with created dollars (wish it could be called (Mosi-oa-tunya currency — the currency that keeps falling) in order to finance the so-called Command Agriculture.

By Tendai Kamba

This increase in money supply has fuelled the fires of hyperinflation, led to the rapid fall in the exchange rate, increases in electricity tariffs (that is not available anyway) by more than 320%, and fuel by more than 25%. I believe that, besides adding misery to the already miserable and unbearable lives of Zimbabweans, the so-called Command Agriculture will not work for a number of reasons.
First, Command Agriculture is just a way that Zanu PF designed to transfer rents from the ordinary Zimbabweans or State coffers into the private hands of the Zanu PF elites.

The first people in line to benefit from the more than US$500 million allocated for the programme are the senior Zanu PF officials, senior military and civil servants who do not have anything to do with agriculture. Instead of using these resources for agriculture, surely this money will find itself in foreign bank accounts for funding expensive and lavish lifestyles.

Unfortunately, the poor farmer in Karoi would be lucky to see even a single bag of fertiliser from the programme, if any is left after the Zanu PF network down to the village level has looted the inputs. Command Agriculture is a classic programme of privatising State resources and enriching the few elites, while bankrupting and socialising poverty for the ordinary Zimbabweans. Second, the Command Agriculture programme does not have any incentives (carrots and sticks) to encourage the recipients to put the resources into good agricultural use.

The recipients get a blank cheque that does not have any strings attached. This is a classic example of leaving a five-year-old with a cookie jar and expect them to be a responsible person.

There is no repayment requirement for the recipients to ensure that the programme is self-sustaining. There is no requirement of past production history (the only requirement is Zanu PF and or bureaucracy connection), no monitoring of the progress on the utilisation of the assistance, no prosecution of recipients who abuse the system, no record keeping of the recipients, and an evaluation of the impact of the programme after its end. With no incentives, no wonder why most recipients would gladly pocket the money and send the Zimbabwean people a sucker thank you note. This is puzzling, given that even the Chinese model from which this programme is conceived has got string incentive requirements and enforcement mechanisms. This programme is there to provide 100% benefits to the ruling elite, while leaving the Zimbabwean people holding an empty bag without any benefit.

It’s a shame that this programme is there to grease the stomachs of the powerful and well connected.

In conclusion, let me state clearly that I would offer my unqualified support if Command Agriculture is well conceived; it can clearly put Zimbabwe back on a path to the agricultural green revolution that we veered off really bad in the early 1990s. Our agricultural programmes have been there to feed the fat cats (the elite), while loading taxation on the ordinary Zimbabweans through hyperinflation, stripping public institutions of assets (for example Reserve Bank’s more than US$3 billion debt liability from all the Mechanisation programme to Command Agriculture). I propose that for the sake of our country, let us have a Command Agriculture that is fit for purpose in 2019.

One such programme is one in which the government allocates money to public and private agricultural institutions and demand a below market rate that is sustainable.

Then let government institutions such as Agribank (if it still exists) loan the funds under the right incentives, monitor its implementation and evaluate its impact. Such a programme will take Zimbabwe on an agricultural revolution path. I am sure the Zanu PF elite will be happy to live rich among well-off citizens rather than continue the current situation of living rich among poverty-stricken citizens.

If so, I propose that the policy-makers consider this opinion for the sake of my beloved country that bleeds red soil.

This article was first published by the News Day