Monday, 09 July 2012

Written by Edward Okiria

JUBA - The number of commercial banks operating in South Sudan has grown to 14, according to the chairman of the South Sudan Bankers Association, Malueth Chol.

“Before independence, there were eight players in the sector. Now the number has grown to 14 and there are more applications coming in,” he said.

The Government last month signed a memorandum of understanding with Kenya to open a Cooperative Bank.

According to Malueth, the increase in the number of banks has provided South Sudanese with a range of banking options.

“A number of the banks offer credit facilities to clients who have proper collateral, with interest rates ranging from 1% to 10%,” Malueth said.

He said the loans are mainly short term for periods ranging from four to six months and mainly to support local trade, agro-business projects and imports.

When financing agro-business projects the local banks seek to promote local production of vegetables.

However, some of the new banks do not offer credit facilities yet, such as International Commercial Bank (ICB).

“For the current financial scenario in South Sudan, we are offering savings accounts, current accounts and corporate accounts for business people,” said the bank’s Managing Director Siraj Pardesi.

Opening savings accounts is free in most commercial banks, but a new client has to deposit some money to make the account active. Also some banks have no set minimum balance.

“As this country is new, for a savings account you can do with zero balance. But to activate it, you put SSP50 onto the account,” Malueth said.

One of the challenges the commercial banks are facing is scarcity of dollars, created by the shutdown of oil production.

This threatens the financial viability of some of the banks, which have only limited amounts of dollars available.

The Bank of South Sudan reduced the dollar allocations to commercial banks from $5m per week to a dismal $1m per week. Prior to the oil shutdown the Banks were receiving $10m per week.

“We are trying to help our customers by getting dollars from the Central Bank and from some of our customers, especially the NGO’s who are banking with us,” Siraj said.

The dollars allocated by the Bank of South Sudan are specifically meant for food, fuel and medicines.

The stringent measures have forced the commercial banks to also tighten their rules on how clients access the few dollars, with most of them demanding a series of documents to justify their need for the dollars.

Malueth said the shortage of the dollar has made it difficult for the banks to extend credit facilities to customers.

“People should know that the banks do not have money. These are customer deposits. They should have that in mind when they borrow,” Malueth said.

Whereas the entry of the big banks into the business arena is a threat to the local banks, it is also seen as a boost to investor confidence.

“Big players are joining the banking sector. This will increase investor confidence in the safety of their deposits,” the undersecretary for investment, Elizabeth Majok, said.

Commercial Banks

Ivory Bank

Kenya Commercial Bank (KCB)

International Commercial Bank (ICB)

South Sudan Commercial Bank

Bank of Khartoum

Qatar National Bank

Equity Bank

Buffallo Commercial Bank

Agricultural Bank of South Sudan

Ethiopian Commercial Bank

Nile Commercial Bank

Afriland Bank

Stanbic Bank

Cooperative Bank of Kenya

Monday, 09 July 2012

Written by Emmanuel Data

Juba - Agricultural agencies face enormous challenges in their efforts to promote agriculture and boost food security in South Sudan, ranging from lack of seeds, traning and research to high labour cost and poor roads.

The Government’s capacity to provide agricultural services is very weak, says Josph Okidi, the programme officer for the Food and Agricultural Organisation (FAO).

“Without these services, farmers lack vital information to improve their production,” he notes.

Poor infrastructure is another obstacle, making some areas which could produce surplus food unable to access the markets.

“Areas like Akobo and Pochala in Jonglei are completely inaccessible by road” Okidi says.

In addition, he says, the labour cost in South Sudan is very high. As a result, goods from Uganda are cheaper than what is produced locally.

He also cites the unavailability of seeds and agricultural inputs on the local market, creating a lot of reliance on NGOs.

The lack of a local research centre where new breeds and varieties can be tried out is another obstacle.

The ‘Green Revolution’ in Asia in the 1970s multiplied crop yields largely through the introduction of new seed types and fertilisers.

“Most agricultural inputs come from outside and are not tested locally. There is need to establish a research station to test varieties and advise farmers on how to improve their yields,” says Okidi.

Instability and perennial conflicts also affect agriculture in many parts of the country, he notes.

Nevertheless, the FAO programme coordinator sees remarkable progress in local food production.

“We are reducing our emergency programme as people open up more land for agriculture and farmers produce more food” says Okidi.

FAO only delivered emergency food aid to six of the ten states this year.

The biggest emergencies were in Jonglei, Northern Bahr el Ghazal, Upper Nile, Warrap, Lakes and Unity, where the organisation targeted 63,000 households with 900 metric tons of assorted crops.

Okidi says they normally get funding to the tune of $ 5 million to $10 million a year. This year, however, they expect to get US$ 15 million, which will enable them to do more.

FAO has been offering various agricultural activities to farmers in South Sudan, ranging from support to crop production, fisheries, irrigation, providing vaccines for livestock and giving processing mills to farmers groups.

Sidebar

Obstacles to boosting food production

- Weak agricultural services

- Poor roads

- Lack of irrigation schemes

- High labour cost

- Unavailability of seeds and other inputs

- Lack of local research centre

- Instability and conflict

Monday, 09 July 2012

Written by Emmanuel Data

Juba - One of the priorities of the newly independent nation was to diversify the economy through modern agriculture, but efforts are still a far cry away.

Farmers all over the country have made repeated appeals to the Government to make tractors accessible to facilitate large scale production. But few have managed to access them.

Yet, at Kopuri Agriculture Mechanised Training Centre along Yambio road, just outside Juba, 79 tractors are parked in a sorrow state, with deflated tyres.

The tractors were imported from Pakistan in 2009 but three years later, only three of them are still functioning.

In the same compound, another 53 new tractors, imported earlier this year, are parked. They are awaiting a decision by the Ministry of Agriculture to be deployed.

Some of the tractors brought from Pakistan by the then agriculture ministry were distributed to the states, but others have remained in the compound up to today, explained the centre’s director for technical training, Henry Alhaz.

“Most of these tractors have no spare parts and there is no workshop or shed where they can be parked to reduce the rate of depreciation,” he said.

People are willing to hire the tractors, but the three functional ones are not enough, he added. “We hire tractors to farmers at SSP 150 for ploughing and SSP 100 for harrowing,” he said.

Moreover, the centre has only four drivers and two mechanics and they are not equipped with any tools. The centre has not received any money from the Government.

Alhaz proposed that an extension service unit be established at the centre to advise farmers on how to improve their crop yields and train them on ox-ploughing and water generation.

He also called for the establishment of processing and marketing programmes to uplift farmers.

When contacted, the advisor at the Ministry of Agriculture and Forestry, Waragak Gatluak, said most of the first batch had been distributed to the states at a flat rate, while others were given to individuals.

On the new lot, he said the ministry acquired 150 tractors for distribution but it has not yet received the implements for all of them.

“We have received implements for 47 only. These are the ones which are ready for distribution while the rest will wait until their implements are received,” he said.

Gatluak said the tractors are distributed on an equal basis to each of the ten states. He added that the ministry is going to introduce vocational training for mechanics and drivers for the tractors.

He also announced that the Government had secured funds for big mechanised schemes in Renk (Upper Nile), Aweil (Northern Bahr el Ghazal), as well as in Unity and Warrap states.

Monday, 09 July 2012

Written by Emmanuel Data

JUBA - The Ministry of Agriculture and Forestry wants to ensure that each family in South Sudan cultivates 3.5 to 5 feddans (acres) of crops.

“If each family cultivated that amount of land, they would be able to produce enough food to eat and have surplus for sale,” said Waragak Gatluak, the advisor in the ministry.

The ministry plans to provide farm inputs, quality seeds, extension services and land protection services at boma level.

“Agricultural banks will be asked to offer micro-finance loans to implement these plans. A budget has already been secured for the establishment of agriculture and cooperative banks,” Gatluak announced.

The ministry has also secured funds at the tune of SSP17 million to run big schemes.

“We have got funds for almost 10,000 barrels of diesel oil and 2 to 3 tons of lubricants for big mechanized schemes in Renk (Upper Nile), Aweil (Northern Bahr el Gazal), Unity and Warrap,” he said.

They have already started rehabilitating the irrigation schemes in Upper Nile and the Aweil Rice Scheme, he added.

The ministry believes that mechanised agriculture through irrigation is the best method to boost food production.

In the long term, the Government plans to set up large-scale irrigation schemes in Central Equatoria, Jonglei, Upper Nile and Lakes states through partnership with the private sector.

“Already, the ministry has secured SSP20 million for the purchase of heavy machines to clear land for cultivation,” Gatluak said.

Since seeds are now bought from outside, mainly from Kenya, the Government also wants to boost the production of seeds locally.

This year alone the ministry has distributed 520 tons of seeds for cereals, including maize, sorghum, groundnuts, rice and soya beans, to farmers in the states, Gatluak said. FAO distributed another 366 tons of seeds.

The Government is also planning to train payam agriculture extension officers. “Training for 513 payam agriculture extension officers is about to start in Yei and other states,” Gatluak said.

In addition, they want to establish grain reserve facilities and apply for membership of the East African Grain Council.

The advisor called on the Government to allocate 10% of the national budget to agriculture. He also appealed to the commercial banks to allocate part of their budgets to the development of the sector.

However, despite efforts by the ministry to encourage large-scale farming, Gatluak complained that many investors have let them down.

“We have received a lot of investors interested in the sector. But once they sign an agreement, they tend not to come back. With the improvement of security and laws for investors in place, we hope they will return.”

He cited other challenges as changing people’s attitude from traditional ways of farming to commercial farming, and laziness among the youth who don’t want to engage in agricultural activities.