Agriculture named worst performing sector - report

Farmers tilling land for planting crops. Agriculture is a source of livelihood for the biggest segment of the population PHOTO BY CISSY MAKUMBI 

By ISMAIL MUSA LADU

Kampala- Contrary to the government position that agriculture is steadily picking up, a report by Civil Society Budget Advocacy Group (CSBAG) tells a different story.

Agriculture, which provides a livelihood to the biggest segment of the population, according to the CSBAG report, has been dwindling over the years.

This is largely attributed to poor absorption capacity of budget resources, while farmers say shortage of capital and credit are their biggest constraints.

“Despite the importance of the sector, agriculture’s output is the lowest in all the sectors of the economy and is far below the National Development Plan target of 4.9 per cent,” Mr Richard Mugisha, an advocacy officer at CSBAG, said while presenting the report in Kampala recently.

He continued: “Uganda has up to now not prioritised agriculture in her public spending to the extent that the sector receives less than 4 per cent of the national budget.”

According to the report, the sector has been steadily declining from 7.9 per cent in 2000/01 to 0.9 per cent in 2010/11, before jumping to a paltry two per cent by the beginning of 2011/12.

Over the same years, there has also been no consistent effort to increase the allocation to the sector. Instead, budget allocation has been hovering between one and two percent of the total budget. The only significant increase came in the previous financial year to a tune of 4.5 per cent (FY 2012/13) only to be reduced to 3.3 per cent in the current budget.

However, skeptics say the reduction has fallen to 2.9 per cent (FY 2013/14), contrary to the international and regional declaration target of at least 10 per cent allocation of the National Budget to agriculture.

The activists’ report recommends that government provides funds for lending to small scale farmers at affordable interest rates. And importantly, that the government should consider establishing an agricultural bank.

“An agricultural bank is important because it will explicitly focus on farmers’ credit needs, hedge them against risks like crop failures and volatilities in the prices of agro-products, something that commercial banks are not willing to do,” Mr Mugisha said in his presentation.

Recommendations
Other recommendations include; embracing value addition and competitiveness, although the budget for that was cut from Shs4.3 billion to Shs0.5 billion.

Expediting rural electrification, use of irrigation, developing infrastructure such as roads and railway to allow market access and increasing productivity are some of the other measures which could see the agriculture sector play a dominant role in the economy.

They also called for the revival of agricultural cooperatives to enable farmers negotiate their prices and market collectively.

But the government remains adamant that it is doing all it can to help agriculture retain its dominant role. Finance Minister, Maria Kiwanuka, said it is erroneous for skeptics to determine the viability of the sector by concentrating only on the budget allocated to Ministry of Agriculture.