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A Timely Discussion. Inflation Starts to Impact on Agriculture in Zimbabwe.


Great sunsets but still no rain unless you count one millimetre

When I took office as President of the Commercial Farmers Union (CFU), I received sound advice that would stand me in good stead for most of my future life as an employer. That is, when I heeded it.

“Good advice is of any value only when the receiver accepts it. Oftentimes, even if we recognise it as such, we are inclined to ignore it, only reflecting on its value in later life when you have little use for it.” - Peter McSporran

Moving from the small office down the hall in Agricultural House into the president's much more spacious office, I gained as my private secretary a small in build, but large, no-nonsense character, Pam Graham. There were many strong women in the CFU, some with management titles, but Pam Graham was the de facto senior as she had the ear of the president. I had no sooner sat at my desk on my first day of office when Pam requested a confidential private meeting. Intrigued, I obliged, and then she simply said, “Should I leave now, or will we be able to work together?” Taken by surprise, I asked her why such a direct question despite her obviously knowing me pretty well as there was never a day in the CFU, even as vice president, I did not interact with her. She then informed me the staff feared me; in her words, “I was too harsh.” This is a common phrase in Africa generally reserved for use by African employees in response to some reprimand from the employer. I thought at first perhaps she was thinking specifically of my private secretary who had departed after a few months of me taking office as the VP. She was a lovely, charming lady, a musician, and an artist, but she just could not spell and nor could I. In those days, everything was written in longhand and then handed over to a secretary to type. We had electric typewriters, which allowed for easier correction but only if the user recognised the mistake. No spellcheck in those days. Perhaps it was more my bad writing that contributed to her errors. Still, being the boss, I eventually suggested we parted ways, despite an appeal by Dr. Jerry Grant, the Deputy Director, who shared her as his secretary. I will not mention her name, but we remained friends regardless of our differences over her typing. I am amiss as I have no idea where she is or if she is even alive today. 


Alistair Smith, whose birthday always fell in Harare Show week, won the Grand Champion bull in 1994 with his junior Limousin bull. - Picture Farmer Magazine

Pam then went on to say it was not just my relationship with my secretary that was of concern, but many of the staff were uncomfortable with my abrupt instructions and demands. There was a feeling that I was not so subtle in my demands, so perhaps I had carried forward an attitude from my days as an army sergeant. The outcome was I listened, surprised as I had always considered myself a fair boss, and after convincing her to stay, I made a considerable effort to be more empathetic to those who worked for or with me. Yes, at times, it may not seem like that to some, but sometimes some people, due to their actions or attitudes, are hard to empathise with. When I do lose my temper, it normally relates to the specific incident and passes quickly. I think it generally worked, for some twenty odd years later, at my AgDevCo farewell dinner in London as an executive director, one of the compliments given to me by the chairman was that I had empathy for those around me from investee to staff. 


As it turned out, Pam and I had a wonderful working relationship; she was hugely efficient and not scared to speak her mind. I was aware that other staff members used her as a conduit for bringing their concerns or grievances to me discreetly. Even the indiscretions of senior staff members or elected members were brought to my notice in a confidential manner. Finally, she was an excellent speller and managed to read or at least get the jist of my hieroglyphics, which saved me hours helping her to decipher my own writing.


“I have found that, over time, the words you write do not always convey your thoughts or what you are proposing in a clear manner. If it is an important document or correspondence, it is well worth getting someone else to review it, preferably someone that knows you.” - Peter McSporran

Shortly after becoming the president of the Commercial Farmers Union (CFU) in 1994, I was asked to open the Chegutu and Kadoma Agricultural Show. The show society president at that time was a member of the well-known Beattie family, Jock Beattie, a much more subdued version of his brother Tom. In that speech, I decided to highlight to the public an increasing danger to farmer viability in the form of rising interest rates and a shortage of available cash in the banks. In 1994, there were markets for all our agricultural commodities, if not locally, then regionally for food crops and beef, except for maize, which was still controlled and therefore could only be exported or imported through the Grain Marketing Board. Our cotton, tobacco, and coffee were all sought after in the world markets due to their quality. Yes, the Government was threatening to take our land but, at the same time, demanding increased production to support their Economic Structural Adjustment Program (ESAP). This program was meant to create better living standards through increased production and more jobs in all sectors of the economy while maintaining strict fiscal control. Agriculture was already feeding the country, and the drive for this expansion in agriculture was through export crops, hence many farmers turning to floriculture and horticulture. Despite some early designations, there was still growing confidence in investing in our farms. Almost everything we earned went back into their development, perhaps with hindsight an error in judgement, but then we were all guilty but currency controls were strict in those days. The complete opposite of present-day Zimbabwe was that the program worked with greater access to foreign currency in the form of retained earnings for the purchase of inputs and capital goods while the export of these funds in hard currency for one's benefit was restricted. Another incentive was to spend it on improvements rather than pay tax. The program gained the support of the IMF and World Bank, and Zimbabwe was still seen as a model of success in the African context. 

 

Me opening the Kadoma/Chegutu show with Diane watching on. - Picture Farmer Magazine

However, despite strict fiscal control, inflation rose, and high interest rates came into being. Both high interest rates and the availability of money for lending in the banking system made it hard for farmers to find finance for the coming season. Their headaches were compounded by the fact that there were no longer guaranteed markets or prices with the removal of controlled marketing. Suddenly, forward contracts on ZIMACE became attractive, but even at that time, unless in hard currency, they were very risky due to gathering inflation. The exception was maize marketing, with the Government, through the Grain Marketing Board, offering a very low floor price, saying that maize should and could be grown by smallholder farmers at a much cheaper price than commercial farmers. Even if this was so, which it was not, it was only because they did not recognise the cost of the smallholder and his family's labour. I was trying to understand why the Government took this attitude, which affected all the people in the maize-growing areas of the country, other than trying to keep the price of staple food down for the urban dweller and the voter. After all it had been proven, the rural voter could be won with a seed handout, a handful of fertiliser, and a T-shirt every four years during election times plus there was little oversight of rural ballot boxes. If they were to stop growing crops, it would go unnoticed, and they would starve unlike in urban areas and on mines. 

“MacSporran said there was no way farmers would increase production if they have no access to a cheaper source of money.” Ziana September 1994

It allowed those farmers selling commodities in foreign currency or at prices in local currency aligned to export value to borrow more locally, relying on the 23% plus inflation rate to cover the cost of the interest. Therefore, many commodities, such as soya and wheat, which were no longer controlled, could be sold in advance with hard currency using a ZIMACE contract as security. This did not apply to the maize farmer exposed to inflation costs of inputs, high interest rates and artificially low selling prices. Maize, to a lesser extent, continued to be grown by commercial farmers, but mainly retained for stock feed. Commercial farmers often fared better than smallholders with the use of irrigation in the time of drought, so this policy had a direct impact on long-term food security. Further, most diversification required irrigation, and many dams were built in those years to allow for this. I was lucky during my term at the CFU as the farmers adjusted their production programs and prospered even with these new challenges. In the meantime, through dialogue and the courts, we were keeping a lid, although slightly open, on the land question. 


One negative aspect of this new found wealth was that it brought about a breed of young successful farmers more than happy to flaunt their wealth in the form of luxury vehicles, be they SUVs, boats and houses all very visible to interested eyes within Government and the so called ‘war vet’ community. I think perhaps it was more the speed of the accumulated wealth than anything else as many well established farmers also drove fancy cars. Once again most of these farmers resided in Mashonaland many being tobacco farmers.


Disclaimer: Copyright Peter McSporran. The content in this blog represents my personal views and does not reflect corporate entities.

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