WHY AND HOW FISP IS BEING UPGRADED INTO A COMPREHENSIVE AGRICULTURE SUPPORT PROGRAM
By Alexander Nkosi
This article discusses the rationale behind FISP, highlights challenges and explains the transition to the comprehensive agriculture support program.
2. AGRICULTURE BUSINESS MODEL
Under commercialisation of agriculture, the goal of every farmer is to make as much profit as possible. The ideal situation is to produce at the lowest possible cost and sell and the highest possible price. To increase the quantity and quality of agriculture output, farmers need to better inputs, improved knowledge in agriculture production and better implements. To maximise profit, farmers need to have access to stable, predictable and remunerative markets as well as processing technology. A farmer therefore needs support in accessing: secure land; quality and affordable inputs; better implements; modern agriculture extension services; stable, predictable and remunerative markets; and processing equipment and knowledge.
3. FISP AND ITS CHALLENGES
Given this background the Farmer Input Support Program (FISP) comes in to adress access to quality inputs, which is only a component of the comprehensive support farmers need as outlined above. While government has been subsidising inputs, other critical things required to increase output and maximise profit have not been addressed. For crops like maize you need to produce large quantities to realise good profit. The quantities of inputs farmers get is low compared to what they would need to make good profit and build successfully agriculture entreprises, as a result of this, they are forced to buy additional inputs at very high market prices. This, coupled with lack of access to better implements, quality extension services and predictable and remunerative markets leaves them either making losses or very small profit margins. The result is they remain perpetually dependent on FISP and don’t graduate as initially conceptualised.
Apart from the big challenge highlighted above, FISP has also had faulty implementation, including: selecting wrong beneficiaries, certain individuals fronting farmers and using them as a conduit to get cheap inputs and sell at a profit, hungry farmers selling inputs, erratic distribution and so many other challenges.
4. IMBALANCE IN AGRICULTURE SECTOR SPENDING
The bulk of our expenduture on FISP goes to importantion of expensive fertiliser. FISP alone gobbles way more than what goes to other components of the agriculture sector budget. According to IAPRI, in terms 2021 allocations by main budget lines, FISP and Food Reserve Agency (FRA) accounted for 86.3% while funding to key drivers of agricultural growth such as extension, research and development was small.
5. LONG TERM SOLUTION
FISP is meant for vulnerable but viable farmers and not just vulnerable farmers. Also note that not all farmers are on FISP and even some of those on FISP still have to buy part of their inputs at very high market prices. The long term solution therefore lies in lowering the prices of inputs for all farmers and providing support in the other neglected areas like extension and marketing. This is what is being termed as the comprehensive agriculture support program. The very vulnerable farmers who cannot afford even at reduced prices are pushed to the Food Security Pack under social security.
6. TRANSITION TO THE COMPREHENSIVE AGRICULTURE SUPPORT PROGRAM
Agriculture output in Zambia is still very low, hence the frequent ban in export of products like maize. Crop production is also largely dependent on having good rains hence the reason we recorded good output even in years when FISP implementation was so erratic. There is need to have more control over the production process and accelerate growth of the sector.
In the face of the high debt burden and serius budget constraints, it is prudent to rationalise agriculture sector spending so as to address all important aspects, grow the sector and improve farmer incomes. This will include:
6.1. Cleaning the list of beneciaries and cutting down on wastage;
6.2. Lowering the prices of agriculture inputs. Kwacha depreciation significantly contributed to the spike in prices of agriculture inputs. The IMF deal, debt restructuring and an inflow of dollars will strengthen the kwacha and ultimately lower the domestic prices of inputs as we work on enhancing local production.
6.3. Reallignment of agriculture sector spending. With prices of inputs going down as economic measures put in place take effect, government will increase expenditure to agriculture extension, research and development, infrastructure, marketing and processing. This will accelerate commercialisation of agriculture and enable farmers graduate from inputs support program and run independently, working closely with the private sector. This will further allow government reduce the inputs subsidy budget as a proportion of GDP and further reallocate resources to other key areas in the sector.
6.4. Support very vulnerable farmers better. More vulnerable farmers that are not viable will be moved to social security where they will access the relief support they need as well as the Food Security Pack.
6.5. Agriculture diversification: Comprehensive agriculture support program will enable government promote crop diversification and support other agriculture entreprises like livestock, poultry and aquaculture. It will also enable government support value addition and strengthen farmer agribusiness relations.
In nconclusion, this whole process explained above will help Zambia upgrade FISP into a comprehensive agriculture support program so as to accelerate agriculture sector growth, enable farmers improve productivity and earn better incomes. It will also help boost agriculture export earnings, economic diversification and job creation. Bumper harvest should translate into increased export earnings and farmer incomes.