The Ministry of Agriculture and Lands is setting aside $2.5 billion in a loan fund that will be made available to small farmers at single-digit interest rates as part of efforts to build the agricultural sector.

Agriculture Minister Roger Clarke announced at a post-Budget press conference yesterday that the Ministry of Finance and Planning is to make available another $1 billion to add to the existing $1 billion that is in the loan fund.

He said also that his ministry was in the process of finalising negotiations with the Bank of Nova Scotia to provide $500 million more in loans at concessionary interest rates for small farmers.

"So it is going to be like $2.5 billion in all available to the sector," Mr. Clarke said.

Single-digit interest

The minister explained that the loans would be made available at single digit interest rates through the PC Bank network and Ex-Im Bank. He said the priority at this time was to facilitate those farmers who have the necessary collateral, while arrangements would be put in place to facilitate those with lands, but have no titles.

"The ministry will work with hotels and the manufacturers to secure markets for these products on a contractual basis. The ASSP (Agricultural Support Services Project) has been assigned the responsibility to work with these prospective investors to formulate business plans and the ministry will direct the viable projects to appropriate sources for loan financing," Mr. Clarke explained.

From this loan fund Mr.Clarke said $250 million will go specifically to sugar cane farmers to rehabilitate and improve production. This forms part of a renewed thrust by the Agriculture Ministry to increase sugar cane production with the recent reallocation of St. Kitts quota by the European Union to Jamaica and three other Caribbean countries. It is estimated that the loan will facilitate the replanting of some 18,000 hectares of sugar cane.