Loans targeting women and youth diverted to other projects

Dar es Salaam. A big chunk of loans provided by the Local Government Authorities (LGAs) of which is 10 per cent targets women, youth and people with disabilities is not spent on the intended purposes, instead the groups divert the funds for some other projects.

The funds are aimed at helping women, youth and disabilities to access loan for them to build their economic capabilities through agriculture and development issues.

Agriculture Non State Actors Forum (Ansaf) Executive Director Mr Audax Rukonge told The Citizen on the sideline of the stakeholders meeting to disseminate research findings on LGAs’ allocation of 10 per cent budget for youth, women and people with disabilities.

According to him, 60 to 65 per cent of the labor force in agriculture is made up of women and youth, unfortunately, they were using the money to open beauty salons and M-Pesa stalls instead of using the money for agriculture.

“The other challenge is that youth and women who access the funds for agricultures were not equipped with the right knowledge and that is why they fail to progress with farming and switch the money into other projects,” he said.

Mr Rukonge stressed that, there was need to have women and youth to focus on productive services rather instead of social services which are already saturated.

According to him 800,000 to one million youth graduate from universities annually, but  only 300,000 get employed.

“However, it’s unfortunate that most of them did not want to access loan for agriculture yet it is a sector that can transform their lives in a short period.”

He urged local LGAs to work with some business experts, officers and extension officers to help train youth and women with agriculture skills.

The findings aimed to generate evidence to influence specific policies promote growth for youth and women in agriculture sector and  assess the capacity of LGA to identify revenue sources such as non-taxes, levies was conducted by Ansaf in collaboration with the ministry of agriculture.

Tanzania Agriculture Research Institute (TARI) principal agriculture research officer Ms Vidah Mahava said despite opportunities found in agriculture, youth were not willing to venture into the sector.

She urged the central government to review the 10 per cent guidelines to clarify the interest on loans, collaterals and the penalties for defaulting.

The research covered 25 LGAs in 14 regions which include Shinyanga, Mara, Kagera, Mwanza, Manyara, Arusha, Morogoro, Lindi, Iringa, Njombe, Mbeya and Songwe stressed that most youth who accessed loan for agriculture did not improve way of farming by using technologies such as green house or drip irrigation.

The findings further showed that the actual average of budget set aside by the LGAs was only five per cent, therefore, some of LGAs did not practically release the funds to the targeted beneficiaries.

Apart from that, it shows that, six out of every 10 loan applications were agribusiness projects related while 4 per cent percent of applications were for small businesses and manufacturing skills or craft related projects.