By Isaac Zulu
Private Sector Development Association chairperson Yusuf Dodia has said that the decision by government to offload Zambia National Service produced mealie meal on the market is distorting the economy.
Speaking in an interview, Dodia observed that offloading ZNS produced mealie meal on the market is not a sustainable solution, adding that the move will discourage commercial farmers from growing maize.
“When you have a government entity engaging with the commercial business sector, you will have a situation where you distort the economy. When FRA is offering a floor price of K280 per bag of maize they are looking at it from a producer’s point of view where a farmer gets a good price because of the cost of production, and ensure that they grow more maize. On the other hand you have Zambia National Service producing maize and in their case the farming inputs are coming from government, which is tax payers’ money, and they are selling mealie meal at a lower price. We had such arrangements in the late 70s and in the 80s,” Dodia explained. “And the private millers will hold on to their stock until Zambia National Service stock runs out. This is not sustainable. The commercial farmers will also stop growing maize because they will feel that Zambia National Service is undermining the reality of the cost of production in the agriculture sector by having the price of maize that is politically set and it’s not for commercial purposes. It’s not about profiteering, it’s about the reality of business. You will distort the economy. If you are importing a bicycle from China at $100 and somebody else buys the same type of bicycle $100 but decides to sell it at $50 when it gets into Zambia, which is half the price, you will pull out of that business.”
He insisted that the approach taken by government to address the skyrocketing mealie meal prices, which involves the offloading of Zambia National Service subsidized mealie meal, is not a sustainable solution and is only ideal where there is a disaster.
“That is just a relief and after two or three months, you will pay the price when subsidized mealie meal runs out. You can only apply such interventions when you have a place where there are floods or fire and all the crops have been deployed,” Dodia said. “
He advised the UPND administration to find a lasting solution to the skyrocketing mealie meal prices; as opposed to applying short term interventions.
“I think we need to move to a point where the agriculture sector should be run vibrantly, instead of focusing on short term interventions.
“I think we need to be looking at solutions that will ensure that the agriculture sector continues running vibrantly. And we need to look at the root causes. What are the root causes? It’s the high cost of electricity tariffs, the high fuel prices, high transport costs and the high prices of fertiliser. Those are the factors that are pushing the prices of mealie meal to go up. And as a country, we need to do our home work,” said Dodia.
