( L - R ) AUBYN HILL, MICHAEL MING, ANDREW COCKING, RICHARD JONES, ASHTON HEWITT
STAKEHOLDERS IN the agricultural sector are calling for better loan terms with lower interest rates to facilitate increased access for farmers.
Dr. Richard Jones, chairman of the FredM. Jones Estate, said yesterday that farmers are not benefiting from international grants because they were unaware of the terms and conditions needed to acquire these loans. Dr. Jones was speaking at The Gleaner's monthly Editors' Forum on agriculture.
"Too often grants and international aid remain unused because those who are in a position to use those funds properly and productively are not informed of their availability," he said. He added that they need to be guided by agencies such as the National Investment Bank of Jamaica (NIBJ) and the Agriculture Ministry, so that they can better access funds.
Dr. Jones suggested that the sugar industry might not benefit from a 60-million euro grant being offered by the European Union (EU) to the industry, unless the money is established in a "stabilisation fund" to manage sugar prices. He said the money ought to be held by the Jamaica Cane Products and Sales Limited to ensure that it is used in this regard.
CREATIVE METHODS
Michael Ming, first vice-president of the Agro Processing Association, agreed that access to funding was low. He added that financial institutions should find creative methods to make loans available to farmers. He is proposing that interest rates on loans be dropped to five per cent and the moratorium period for repayment extended.
"At this point in time we would love something at zero per cent, but that is not realistic, so we are not looking for anything more than five per cent on a long-term basis and a moratorium period must be involved," he said.
To help solve the problem, Deputy Group President of Capital and Credit Merchant Bank, Andrew Cocking said agricultural financing needs to be centralised to facilitate easier access
for farmers.
But in responding to Mr. Ming's suggestion, Ashton Hewitt, senior manager for agri-services at the Bank of Nova Scotia, explained that it was difficult to make funds available at interest rates as low as five per cent. He said that, although his bank had in the past dropped rates to low levels, those were for special cases where loans were available for people affected by Hurricane Ivan.
"I think that anybody getting into the industry, you have to make a serious financial plan," he said.
Aubyn Hill, chairman of the National Investment Bank of Jamaica, said farmers should develop winning business models to access loans easier. "We have to stop thinking that somebody is going to help us ... make it attractive for the bank to finance and it will be financed," he said.
