Novi Weekly Wrap - August 24 Edition

ZANACO launches "loan-a-cow" product

Zambia National Commercial Bank (ZANACO) launched the “loan-a-cow” scheme – the first of its kind in Zambia. Through the scheme, smallholder farmers will be able to acquire cow-loans at an interest rate of 16 percent from ZANACO through their respective cooperatives. The farmer then services the loan through revenues from milk produced from his/her cow which is purchased by milk processors Parmalat/Zam Milk. The processor pays a percentage of the full amount they are supposed to pay the farmer to ZANACO i.e. interest payment. If a farmer can consistently produce 30 litres of milk per day, the loan can be repaid in 3 years.

Over 253 pregnant cows have been imported from South Africa as part of the scheme.  318 farmers from 7 cooperatives have already been given this type of loan. This is probably one of  the more innovative financial products to be launched this year and could go a  long way to enhancing the wealth of smallholder farmers. Smallholder farmers are among the groups in society who have a difficult time accessing finance because of information asymmetries or they are unable to put up adequate collateral. The scheme will push farmers to increase their productivity while providing them a channel to procure more cows. The average cost of a cow is about K12,000. 
 
According to the Minister of Agriculture, 4.52 million litres of milk have been produced in the country year-to-date (5.8 million in 2013). Data from a study carried out by SNV Zambia in 2012 which focused on “untapped milk originating from the traditional cattle sector”, showed that the 15 districts under study had the potential to supply 11.7 million litres of milk every year. The country has the potential to generate millions more in litres of milk from smallholder farmers (who collectively own most of the cattle in Zambia) which brings with it better food security, more income/jobs for community members and better economic diversification for the country.

Government reverses hunting ban for 19 blocks

The Minister of Tourism and Arts announced that the 2013 hunting ban was revoked for 19 blocks with immediate effect. However, the reversal did not apply to big cats (lions, leopards etc) as their numbers had reduced to record low levels. Hunting would only be carried out under strict supervision by the Zambia Wildlife Authority (ZAWA). 

This decision will help boost the tourism sector because there is a huge demand for hunting in Zambia by tourists from many parts of the world. Hunting operators will regain their income generating activities and ZAWA will collect their much needed fees. The decision to keep the ban on big cat hunting is necessary and positive despite the fact that it is in very high demand and generates more income than other game.

Data check

-LME 3-month copper closed at $7,077 per MT
-Yields on the 91, 182, 273 and 364 day t/bills on Fridays auction were 9.5%, 17.5%, 17% and 21.95%, respectively
-The Kwacha was trading at K6.06 per US dollar