Moroccan Ministry of Agriculture writes off agricultural debt

14/05/2007

Nearly 100,000 Moroccan farmers have benefited from the latest government write-off of debts owed to the Agricultural Loan Corporation, totalling nearly 3 billion dirhams.

By Imane Belhaj for Magharebia in Casablanca – 14/05/2007

[Getty Images] Some Moroccan farmers fear missing out on debt cancelation.

In a move to aid farmers beset by drought and other difficulties, the Moroccan Ministry of Agriculture has again absolved the debts of a number of the country’s farmers.

Agriculture Minister Mohand Laenser said in a statement on Wednesday (May 9th) that the recent debt cancelation targeted 99,582 small farmers facing difficulties in repaying their loans due to drought and natural disasters. They were selected according to criteria laid out by the Agricultural Loan Corporation's supervisory council, requiring that the total debt not exceed 500,000 dirhams, that the loans were not granted after 2001, and that the farmers did not possess adequate collateral.

According to Mohammed Tougar, Director of the Chamber of Agriculture in the province of Khenifra (the poorest region in Morocco, according to the latest study by the High Commission for Planning), "all the farmers in the province should benefit from it because they are poor and fulfil the conditions and criteria determined by the Ministry. They work in a region without water or a surfaced road. They are under every material and natural pressure, [and] they need assistance from the state. Also, the region as a whole this year has suffered from inadequate rainfall."

Yousef J., a small farmer in the Al-Shawiya province who owes an agricultural loan of 20,000 dirhams, said that the measures will at least help to lift morale among farmers who have suffered an unsatisfactory season, with harvests considerably smaller than last year’s.

But not everyone agrees. Abdullah Kh., who was not included in this year’s write-off or the debt rescheduling programme undertaken last year, told Magharebia, "I took out a loan from the Corporation 10 years ago, and I don’t have the income to repay the loan, which is 50,000 dirhams, not including interest. Nevertheless, I wasn’t on the list of those benefiting from the comprehensive write-off, whilst there are people better off than me financially who were [found] eligible. We fear that the same favouritism will continue in this new exercise."

The state and the Agricultural Loan Corporation have offered various types of relief in recent years, from interest cancellation to debt rescheduling or even forgiveness. Over the last eight years these relief programs have benefited approximately 350,000 farmers at a cost of more than 7 billion dirhams, 240,500 of these farmers have been completely absolved of their debts.

The issue has angered certain parliamentarians who, last week, verbally questioned Laenser on the degree to which compliance with the Ministry's criteria was used in selecting beneficiaries. The minister confirmed in front of Parliament that decisions were taken based on a list prepared by the Agricultural Loan Corporation, and if any error was proven to have been made, the administration would correct it immediately, explaining that the exercise was not intended to encourage farmers not to perform.

An expert in the agricultural sector, Abdessallam Saddiki, commented that Moroccan agriculture is in need of a clearly defined policy, and that it should not remain hostage to fluctuations in the weather. "Whenever the weather is good we have an abundant harvest and the growth rate increases, but whenever the weather is dry, the result is devastating," said Saddiki. "Moroccan farmers, particularly the small ones, therefore require more attention and initiatives which actually help them to improve the sector and achieve the desired result, not like these seasonal and circumstance-driven measures," he continued.