By: Nghiinomenwa Erastus
The government has channelled N$5,6 of its newly acquired funds and withdrawals from other priorities to subsidise the Agribank loans scheme’s interest.
The mid-year budget policy review shows that part of the re-allocated N$2,2 billion made available, some went to the agriculture and land reforms ministry.
The agriculture and land ministry were given an additional amount of N$7,6 million, of which N$5,6 million was meant for Agribank loans, and N$2 million was for utilities.
The Villager contacted the agri-ministry to elaborate on the additional funds.
According to the explanation provided by the ministry spokesperson, Jona Musheko, the money was to subsidise Agribank loans interest.
Musheko explained that the ministry has a programme called Affirmative Action Loan Scheme (AALS).
Under this programme, the ministry subsidises the interests on loans acquired by the farmers from AgriBank under this programme, for the purchasing of farmland and the construction of housing for the workers on commercial farms.
“AgriBank normally invoices the ministry every month for the subsidy portion of the loan,” he said.
Therefore, the funds will cover the subsidy portion of the AALS extended to farmers by AgriBank.
To promote agriculture or activities related to agriculture.
Agribank was again one of the institutions that benefited from treasury’s N$2,4 billion guarantee-backed loans last year.
The guarantees were made available to lending institutions to facilitate lending during the pandemic.
For households and the business community to have access to credit facilities to cushion the impact of the pandemic while boosting the long-term economic recovery potential.
As a result, Agribank borrowed N$350 million against the government-backed guarantees- to extend to the agri-sector.
In May this year, the bank has also updated that it has received 377 Covid-19 relief applications and has approved 272, while N$263 million in total outstanding loans in Covid-19 restructuring was approved.
Beyond Agribank, the agriculture sector is also benefitting from the ongoing implementation of the N$4 billion AfDB-funded projects for agricultural mechanisation.
The mid-year budget review has highlighted that the primary focus will be to accelerate economic recovery, diversification, and job creation.
The strategic interventions in this respect will entail reviewing the sustainability of production and productivity of government green Scheme Projects and public enterprises in the agriculture sector.
As they hold significant potential to contribute to resuscitating sustainable growth, the policy read. Email: erastus@thevillager.com.na
