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Rural poor not getting agric funds, says study

By Vision Reporter

Added 5th July 2010 03:00 AM

BILLIONS of shillings allocated under the agriculture credit facility do not reach small-scale farmers upcountry because it is held by big banks in Kampala, a study has found.

BILLIONS of shillings allocated under the agriculture credit facility do not reach small-scale farmers upcountry because it is held by big banks in Kampala, a study has found.

By Cyprian Musoke
and Rachael Ninsiima

BILLIONS of shillings allocated under the agriculture credit facility do not reach small-scale farmers upcountry because it is held by big banks in Kampala, a study has found.

The study presented on Thursday at a dialogue to analyse how the 2010/11 budget will affect the poor, stated that the funds are mainly accessed by large-scale farmers who are already prosperous.

“This is a small portion given that 68% of the population engages in subsistence agriculture,” the study noted.

Under the credit facility, the Government in the 2009/10 financial year gave sh30b to banks, while the banks contributed sh30b, totalling to sh60b, for farmers to borrow. In 2010/11 financial year, the fund has been increased to sh90b.

“However, interest rates have been raised from 10% to 12%. The funds are mainly accessed by large-scale farmers to buy milk coolers, irrigation systems and trucks at the expense of small-scale farmers,” the study presented by Makerere University lecturer Prof. Augustus Nuwagaba said.

It was carried out by the Civil Society Budget Action Group in conjunction with Uganda Debt Network (UDN) and Reev Consultants.

The research also found that National Agricultural Advisory Services was extended to 100 farmers and has provided seeds, fertilisers and equipment, unlike the previous years when its impact was minimal.

The UDN executive director, Patrick Tumwesige, said there is need to boost household income and increase the tax base by creating more employment opportunities.

Parliamentary public accounts committee chairman Nandala Mafabi called for proper planning to reduce the 7% budget deficit and create jobs for the youth.

Moses Ogwal of the Private Sector Foundation said the budget must aim at creating competitiveness to spur growth and employment opportunities.

Rural poor not getting agric funds, says study

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