Hugh Martin TWO WEEKS short of a year ago (December 21, 2001) The Gleaner carried a story entitled "Citrus programme qualifies for DBJ loan" and went on to reveal that that loan of $4 million was the first to qualify under the Citrus Replanting Programme. This was nine months after the replanting programme was launched and seven months after protests by farmers about the delay in disbursements of the loans.
In my column of December 28, I expressed surprise at the slow start to this programme designed to save the industry from a virtual wipe-out from the disease caused by the Citrus Tristeza virus (CTV). One would have expected that having started late the pace would have picked up and the farmers would by now have put in thousands of acres of certified resistant plants. Not so. Chairman of the Citrus Protect Agency, Mr. Peter McConnell, speaking at the recent meeting of farm leaders called by Agriculture Minister Roger Clarke, revealed that up till then only 27 loans had been disbursed under the programme. My checks have confirmed this, and worse, that many citrus growers have decided against taking up the loans.
Under the programme, funded by the Caribbean Development Bank and the Ministry of Agriculture, and administered by the Development Bank of Jamaica (DBJ) through the commercial and merchant banks as well as through the People's Co-operative (PC) banks, some 7,500 hectares of citrus are to be replanted over a five year period. A little over 2,000 acres should have been planted out by now, two years after the scheduled start. However, only 866 acres have been completed so far with the smaller growers responsible for about 200 acres. When you remember that there are some 6,000 citrus growers affected you begin to understand that a serious problem exists in the industry.
It is not enough to dismiss the farmers' reluctance to take up the loans as a manifestation of the traditional dependency on handouts as some persons have suggested. There are in fact some very strong arguments for their position. They cite "the burdensome application process, the onerous security requirements and the slow pace of disbursement". The growers object to the demand by the PC banks that they acquire shares up to the value of $7,500 as a pre-requisite for accessing loans. In addition a land title is required as collateral and it must be accompanied by a recent valuation. These, the growers see as added costs to them. Depending on the size of the holding, the valuation fee can be a sizeable sum. Many chose to finance the replanting from their meagre resources while others have decided to let the trees die without replacing them. In addition many of the farmers do not possess titles to the land they farm and are therefore unable to provide the required security. All of this has contributed to the slow pace of the programme.
The DBJ on the other hand, while acknowledging the plight of the growers, must operate in a manner that will protect its investment. And therein lies the problem. The Government, having gone to all that trouble to obtain the funding, enact legislation, establish agencies and programmes, now finds the whole shebang stymied by systems and procedures that are clearly frustrating the "programme."
A GENUINE FEAR
But the reluctance of the farmers to take up the loans goes beyond those stated objections. They have a genuine fear of acquiring any long-term debt given their uncertainty regarding the future of the industry. At present, only about 15 per cent of annual production reaches the export market. The bulk of it is sold on the local market. The big concern is that a bigger threat is looming on the near horizon. The Dominican Republic, freshly admitted to CARICOM, has its eyes firmly fixed here and is just waiting for the Caribbean Single Market and Economy (CSME) to come on stream to flood the market with its lower-priced fruit. The farmers are not ignorant of these developments so their caution is understandable.
In his presentation referred to before, Mr. Peter McConnell, who is also managing director of the former United Estates, urged the Minister of Agriculture to address that particular problem with some urgency. Mr. McConnell's company, fully aware of the threat by the Dominican Republic, has gone full steam ahead on a major replanting programme. It is a calculated risk that is banking on the belief that the government will not allow the industry to die after making that significant effort to save it. The plea was for protection of selected industries. Pick winners, revisit the conditions of the CSME and protect those industries, "WTO or no WTO," he pleaded. The implication being of course that the citrus industry should be seen as one of those winners. Well, is it?
It seems to me that the Government has little choice at this stage than to regard it as such. Having committed itself to the replanting programme to the tune of well over US$20M there seems to be no turning back on this one. It has already made concessions to the farmers in the matter of the interest rate, lowering it from 11 per cent to 9 per cent. Clearly, some action must now be taken to make it easier for them to access the loans and to quell their fears about the future of the industry. If those actions are not taken and soon then a Jamaican citrus industry can be written off as history.
Hugh Martin is a communications specialist and farm broadcaster. E-mail: humar@cwjamaica.com.
