LUSAKA, Mar 24 - Zambia has not registered significant and visible capital outlays in agriculture resulting in low levels of production, the Zambia National Farmers Union (ZNFU) has said.
In its latest bulletin of The Farmer, the ZNFU says the agricultural sector is now characterised by obsolete machinery and equipment, outdated and inefficient technology and a non-performing marketing system.
The ZNFU also says there is very little to be said about agriculture research, though it is key to agricultural growth.
"Much of the reason for this scenario can be directly traced to inadequate levels of investment into the economy.
"Zambia is in dire need of fresh investments into the whole economy in general and more so in the agriculture sector," the ZNFU says.
The ZNFU, however, says distortions in the economy have continued to hamper meaningful growth in the sector.
It says Zambia's levels of capital formation are much less than what is required to sustain economic growth of about 10 per cent per year, in line with other developing economies in the region.
"It is apparent that the structural imbalances in the economy cannot allow, in the short run, domestic resource mobilisation for investments into the economy.
"These structural distortions include primarily the huge domestic debt and continued Government borrowing from the banking sector, which has been crowding out resource flows to the private sector. As a consequence of this, interest rates have been too high to allow viable investments in the agricultural sector," the ZNFU says.
The ZNFU says, given this scenario, Zambia's biggest hope is to woo Foreign Direct Investment (FDI), which is long term as opposed to short term investments.
The publication says FDI also brings about economic development and with it comes new technology, modern equipment and industrial infrastructure with emphasis on production, and modern human resource practices and training for locals, and new marketing and export techniques.
"It also creates an understanding and commitment to national and global competitiveness and enhances modern entrepreneurial practices. It enhances competition in the domestic market, and consumers in turn have a wider range of product choice," the ZNFU says.