Africa-Press – Tanzania. NEWS that 32 farmers affected by excessive rainfall and drought incidents have been compensated 23m/- for their crop losses at a recent event held in Morogoro is a new development in revitalising agriculture as the mainstay of the national economy.
It is in the public interest to have a financially stable agricultural sector that produces the nation’s safe and affordable food and fibre supply and supports the rural economy.
That necessitates the presence of a publicly-supported safety net for farmers, who increasingly face variable weather patterns that challenge the food production system as well as face unfair competition from foreign countries that subsidize heavily and violate international trade rules.
The National Insurance Corporation (NIC) has introduced the safety net of crop insurance.
Its importance was in full display in Morogoro when the Permanent Secretary in the Ministry of Agriculture handed over a 23m/- cheque to 32 farmers whose crops – maize and paddy – were heavily affected by the 2019/20 agricultural season excessive rains and drought incidents.
The farmers benefited from the hybrid Lima Salama crop insurance product developed by ACRE Africa with support from funding through the FISFAP programme under Alliance for a Green Revolution in Africa (AGRA).
The product is underwritten by the NIC covering two value chains of maize and paddy and is available in four regions of Iringa, Mbeya, Njombe and Morogoro.
The Lima Salama product covers farmers against weather and nonweather related risks such as pests, diseases, drought, excessive rainfall, floods and wild fire.
It is distributed in the form of scratch cards, through agro dealers and other dealers who have direct contacts with farmers across the regions.
Crop insurance is the primary risk management tool farmers use to financially recover from natural disasters and volatile market fluctuations; pay their bankers, fertiliser suppliers, equipment providers and landlords; purchase their production inputs for the next season; and give them the confidence to make long term investments that will increase their production efficiency.
Without effective and affordable crop insurance, catastrophic production losses would sap the rural economy by setting in motion a series of harmful events: farm failures and consolidation, job losses, farm-related small business failures, financial stress on banks and reduced investment in Tanzania agriculture.
