Agriculture financing; an urgent situation

It is five years now since the bank created to boost agricultural activities in the country was announced. Cameroonian farmers are certainly taken aback to see that such a long period has elapsed without any possibility of them rushing to the bank to get the necessary finances to fund their activities.

As the days pass by, hopes are rekindled with the setting up of the structures therein to enable the bank effectively go operational. The bank’s administration has been set up and the initial capital put in place to enable the institution functional. But on the ground, nothing has changed.

This state of affairs has been troubling Cameroonians, considering that agriculture represents more than half of the country’s non-oil export revenue and employs almost 60 per cent of the working population.

Ninety per cent of rural households are, in one way or another, employed in agriculture, and approximately one-third of them earn their living from export crops.

The announcement by the Chamber of Agriculture, Fisheries, Livestock and Forestry of the setting up of microfinance in charge of supporting farmers and ensuring their social security is another welcome initiative.

Farmers, in effect, received the news with mixed feeling especially as they haven’t been able to reap the fruit of the much pampered agriculture bank.

In any case, they have continued to operate within their historic precincts financing their activities with their meagre savings, Njangis, contributions, common initiative groups and cooperative societies.

In addition, pending the effective functioning of the agricultural bank and the microfinance institutions, government has not stopped providing subventions to farmers through their various cooperatives and other groups.

This is being done through the various projects in the Ministry of Agriculture and Rural Development. Some of them include: projects in charge of inputs such as fertilizers, chemicals (insecticides, herbicides, fungicides) and seedlings. But this has not been enough to solve the problem.

Agriculture, it should be recalled, is more of a private sector economic activity. Government’s action should in the real sense constitute assistance. Unfortunately, many Cameroonians continue to think that government must play a primordial role in developing the sector.

This entails that the creation of financial institutions ought not to be the sole source of funding for many a farmer. That said, local financial institutions of the private sector have not been of great assistance to the agric sector.

Commercial banks for instance, continue to see agriculture as a highly risky sector and so, are not ready to give out loans to farmers. The conditions remain draconian. And whenever such loans do come in, there is sometimes lack of follow up to ensure that such projects are effectively implemented. It is not the first time a bank is being created to promote agriculture in Cameroon.

The faith of the Rural Development Fund (FONADER) remains engraved in many minds. Created for farmers, the bank became a financial haven for the well-to-do. At the end of the day, loans were disbursed to people who were neither agriculturalists nor potential ones.

The announcement of another bank brought back minds to the woes of FONADER and this explains why many continue to think and wish that the slow takeoff of the new structure should be a measure to avoid the errors of the past.