Financing in the agricultural productive sector is essential to achieve good yields and adequate qualities.
Because 76% of Dominican producers do not have their own resources to run an agriculture supported by proven research.
With technologies that guide soil preparation under modern methods, certified planting materials, pest and disease controls, herbs, appropriate cultural work, collections and storage that reduce common losses and processing that provide greater added values.
Well, the aim is to guarantee affordable prices at the income level of local consumers and compete successfully in the international market.
In this context, Dominican agriculture requires raising financing from RD $ 44.2 thousand to RD $ 74.2 billion annually, equivalent to 11.34% of the credit of all sectors of the national economy.
However, that global agricultural financing was RD $ 27.0 billion in 2012, rising to RD $ 44.2 billion in 2019, thanks to the momentum caused by the extraordinary increase in agricultural Bank disbursements was 360.7%, at go up from RD $ 6.0 thousand in 2012 to RD $ 21.8 billion in 2019.
(I am not referring to the year 2020 because it was an abnormal period, due to Covid-19).
Therefore, putting into practice an agricultural, fisheries and forestry development plan that influences rural development, as a model of progress, requires that the financing portfolio be increased by a minimum of 60.0%, injecting more resources into the Agricultural Bank, with the idea of taking it to RD $ 36.5 billion.
In addition, implementing formulas that activate private banking, guaranteeing with Agricultural Insurance, that they will not be harmed by the effects of natural risk of agriculture and covering a percentage in the interest rate.
The idea is for the private sector to add some RD $ 15.0 billion to agriculture.
Thus we would reach RD $ 74.2 billion annually.
Within this value, the necessary funds are included, in financing, of the projects of the reformed sector, which amounted to RD $ 10,260,036 million in 2020.
Agrarian reform
By their own origins, agrarian projects need credit support from the State.
And the fact is that the parceleros arose from being “threw days”, or peasants without land, that is, without jobs, to producers whose income would be subject to the reach of excellent crops or breeding, with good prices.
Therefore, their development as productive units is in line with the financing applied in strictly elaborated production costs, in accordance with the conditions of the land, the climate, the demands of the crops and the novelties that have arisen in the research centers.
At the cost of 2020, the agrarian reform required RD $ 10,260,036.0 million, of which RD $ 6,166.0 million were demanded for cereals; RD $ 1,204.2 million for vegetables, RD $ 494.1 million for fruit trees, and thus the other groups of items.
These amounts were planned mainly in the La Vega, San Francisco de Macorís, Nagua, Montecristi, San Juan de la Maguana and other managements.
I believe that with the titling process that has been carried out, it is possible to obtain greater loans from private banks, and that the government fully involves the Reserve Bank.
Because state financing of agrarian projects has determined, to a great extent, the success and setback of the agrarian reform, since, I repeat, commercial and multiple banking does not finance this subsector.
Regarding informal credit, it should be noted that although producers receive it as a Solomonic outlet, in the end they become a way of transferring profits from smallholders to intermediaries.
This is actually an advance (the loan) to the future and a forced sale of the harvest, because the agreement includes a certain price, which is usually lower than the price that would be at the time. of the transaction.
The scope of credit for agrarian projects has also suffered greatly from inflation, sometimes unconscionable.
While the prices of the products at the farm level have risen so slowly that they do not compensate for the spread of costs, which makes it more necessary to raise the values of the loans and introduce measures that guarantee profitability.
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