DOCUMENTARY CASE STUDY
CARE ZIMBABWE: AGENT PROGRAMME
BACKGROUND
CARE Zimbabwe started operations in 1992 in Zimbabwe and the AGENT programme was
piloted in 1995. Zimbabwe has an estimated population of 13 million people of which over
6million are based in the smallholder farming areas. Zimbabwe has a dual agricultural
system comprising large-scale commercial farms and smallholder communal and resettlement
farming areas.
Zimbabwe implemented the Economic Structural Adjustment Programme from 1990 under
the conditions and guidance of the IMF and World Bank. Prior to that period, Zimbabwe had
two fertiliser companies based in the capital city Harare and servicing the whole country.
There were also two seed houses servicing the country using government research unit
developed material in the form of hybrids. The government had an approach of servicing the
smallholder sector (that had been marginalized as a result of the colonial legacy of a dualistic
agricultural system favouring the large-scale commercial farmers). In this regard the
government increased agricultural investment to levels of 3.2% to 7.3% of the national
budget, mainly targeting the smallholder sector. Marketing co-operatives were also set up in
all the 57 districts of the country and these were provided with government financial and
technical support. All in all, these marketing co-operatives supplied up to 70% of agricultural
input requirements to the smallholder-farming sector. The government also set up a total of
68 Grain Marketing Board depots for the purchase of commodities from the smallholder
sector. The smallholder farmers were provided with good agricultural research and extension
services and maize seed and fertilisers were provided for free to the farmers. With the
introduction of ESAP in 1990, the government had to rationalise its expenditures.
Investment in the agricultural sector dropped from 4.3% over the pre ESAP period to an
average of 3.2% over the 1990 to 2000 period. The level of investment dropped even further
to an average of 1.8% of national budget over the 1995 to 2000 period. This translated into
reduced support for the marketing co-operatives and over 90% of the co-operatives collapsed
or remained operating at very low capacity. The level of smallholder farmer support also
reduced considerably with one extension worker serving up to 1200 farming households from
a previous ratio of 1: 400households. This forced communal and resettlement farmers to
travel long distances to source agricultural inputs. The increased transaction costs forced
most communal farmers to reduce on the quantity of inputs they purchase.
The importance of agriculture to the Zimbabwean economy cannot be overemphasised. It
accounts for about 15% of the GDP and provides 70% of the employment in the country. The
sector also accounts for 40% of the national merchandise exports. The agricultural sector is
the mainstay of approximately 6million people in the communal areas who have between 2
and 5 ha of land. At the time of project inception, there were massive retrenchments of
people, from urban industries, who then made their way into rural areas.
Generic causes of smallholder isolation in the country
The smallholder farmers were mainly marginalized from active participation in the market
economy for a number of reasons. The first major reason is that the private input
manufacturers and distributors did not set up distribution and marketing infrastructure in
smallholder markets. The primary reason advanced was that of the nature of their large
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
volume and small margin business, which made it costly to deal with dispersed and small
volume farmers. This created a situation where middlemen charged exorbitant prices for
inputs and most of them doubled prices of inputs for distances as low as 100km from the
supply sources. The collapse of the co-operative movement also caused numerous problems
for smallholder farmers as they had long distances to travel to get inputs. The nonperformance of the rural credit markets also constricted effective demand from smallholder
farmers and also hindered rural traders based in smallholder markets from stocking the
required agricultural inputs. This has also been made severe by the lack of ownership of the
land by the smallholder farmers and this has effectively locked the value of the land. In this
respect, they cannot use the land as collateral in order to access finance. The smallholder
sector has generally been suffocated by inefficient markets for inputs and outputs and locked
farmers into a low production and low saving situation. This has been exacerbated by the
poor relationship between the cost of inputs and producer prices, worsened by ill-conceived
policies such as price controls, which hurt the farmers most.
Project description: goals, objectives, target area and groups, expected outputs
The AGENT programme goal is to increase household livelihood security of men and women
farmers in the communal areas of Zimbabwe. The programme hopes to attain this through the
establishment of a network of rural traders. The project targets smallholder farmers in
communal areas by increasing their access to agricultural input and output markets. The
expected outputs from the project are: increased access to agri-inputs by men and women
farmers at lower cost, sustainable, replicable direct business relations between private sector
(PS) and network of agents, increased output marketing options for smallholder men and
women farmers, increased baseline, monitoring and evaluation information allowing
stakeholders to draw conclusions on the validity of key development assumptions.
2. Implementation Methodology
Distribution Channel
Manufacturers of
agri-inputs
Consignment
Wholesalers
Agents
Agents
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
Farmers
Farmers
The implementation methodology evolved over the years and the AGENT programme creates
linkages between the agents and private sector suppliers for the effective access of inputs to
smallholder farmers. The key stakeholders involved are seed houses, fertiliser manufacturers,
chemical companies, intermediate technology suppliers as well as wholesalers. The agents
sign contracts with their suppliers for the provision of inputs and repayment of the provided
credit. The suppliers also sign contracts with CARE to agree to the risk sharing arrangements
and this is triangulated by contracts by CARE with agents. The suppliers assume between 20
and 100% of the risk and the agents cover 10% of the risk of default.
Principal role of partners
CARE: area mapping, agents recruitment, agents selection, training and mentoring, credit
provision, produce market development
Private sector: area identification, area mapping, agents selection, agents training, coaching
and mentoring, agents graduation, credit provision, demonstration trials, produce markets,
credit provision.
Agents: application, farmers awareness, market surveys, payment of cash securities and
training fees, provision of training stationery, marketing of inputs and produce, information
dissemination and repayment to suppliers.
Others: provision of information on agents, farmers and agents training, provision of
prophylactics.
With regard to output marketing, the programme adopts the approach that focus follows
research and in this regard subsector analysis are conducted in crops of interest. This is
followed by subsector participants’ workshops where results of subsector studies are shared
and task forces are formed. From this, models for implementation are developed. At the
moment the programme is piloting an outgrower scheme in sorghum with the largest
commercial brewer in Zimbabwe. The programme is also in the process of negotiating with a
medium scale company on the purchase of groundnuts for export with the buyer providing
capital to agents.
3. Outreach
The programme targets smallholder farmers of rural Zimbabwe, particularly the low
resource farmers in communal areas. Wealth rankings, conducted by the programme in
conjunction with other extension counterparts, indicate that the programme works with
three principal income categories from the poorest to the richest farmers. Of all the
clients reached by the programme an average of 52% are male while 48% are female
(CARE Zimbabwe AGENT Programme MIS 2001). A sample of 1716 agent customers,
conducted in the agricultural season 2000-2001, indicates that the programme has a
greater attraction to the poorer farmers, as 49% of the agent customers fell in the poor
category. A further 34% represented the average wealth category and only 17% were
considered by their peers to be rich. Although 52% of the sample clients are men, it was
found that in the poor category 54% are women customers. Thus it would appear that the
programme has more of an impact on poor farmers and amongst those poor farmers,
women are benefiting slightly more than men.
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
CASE ANALYSIS OF INCOME CATEGORIES AND BENEFITS FROM AGENT PROGRAMME
Wealth
Category
Number of Farmers
Total
Males
Minimum Minimum
Females Purchase Purchase
Maximum
Maximum
Purchase
Purchase
Males
$ 161.00
Females
$29 1.00
$
Males
1,833.00
$
252
OR
31%
$ 306.00
$ 148.00
$
2,414.00
$
1,919.00
130
OR
15%
$ 293.00
$ 222.00
$
2,490.00
$
2,257.00
POOR
848
OR
49%
409
OR
46%
439
OR
54%
AVERAGE
582
OR
34%
330
OR
37%
RICH
286
OR
17%
156
OR
17%
Products Purchased By Income
Groups
Females
1,730.00 *Maize seed (1,2,5,10kg), fertiliser,
asbestos, nails, *stockfeed, plough
shares, *hand tools, *cement, grain
protection chemicals
Maize seed (2,5,10,25kg), *fertiliser
AN, chemicals, *implements, cement,
*stockfeed concentrates (50kg
*Maize seed (5,10kg),
*cement, *stockfeeds,
chemicals, *fertilisers,
wheelbarrows.
Totals
1716
895
821
Percentag
100%
52%
48%
* Most purchased products by
e
income category
Wealth Ranking indicators based on assets: human (education, skills, labour), physical (shelter, livestock, farm equipment), natural
Resources (land holdings), economic (savings)
Source: CARE ZIMBABWE AGENT MIS 2001
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
4. Impact:
Since 1995 the project has set up a total of 580 agents in rural Zimbabwe and successfully
linked them to the private sector. Over 60% of these agents have been absorbed into the
private sector distribution network with no risk to the project. The project has managed to
turnover inputs worth Z$ 85m over the life of the project, whilst under the guidance of the
AGENT program, and graduated agents have probably succeeding in selling far more than
this total once they were weaned from project support (this data has not been captured) and
were in a position to increase their credit limits. Experience has shown that a graduated agent
turns over an average of three times the sales, made while under the programme, and this
would translate to Z$255 million (assuming all agents maintain the same credit limit). The
project has also managed to reduce and in some instances remove the information asymmetry
problems related to the smallholder markets, which tended to inhibit private sector market
development efforts. Suppliers now have ready access to creditworthy customers from rural
areas. The private sector has fully embraced the AGENT methodology and notable players
such as the Zimbabwe Fertilizer Company (ZFC), the largest fertiliser manufacturer in
Zimbabwe has since launched their own input distribution system modelled after the CARE
model. As a show of recognition of the CARE AGENT programme’s agents, a total of 45
former CARE agents were absorbed into that network by ZFC (ZFC Agents List 2001). A
total of eleven private sector companies have worked with the programme and have
continued in their individual capacities to work with the agents. Other NGOs have also
adopted and adapted the AGENT model and developed their own schemes for the benefit of
smallholder farmers, a direct spin-off of the AGENT programme (Phase 1:Comparative
Study of Input Distribution Schemes 2001). Farmers have also benefited from the increased
product range offered through the programme. Agents were on average stocking two
varieties of seed and one line of fertiliser and selling less than a tonne of each of these
commodities, prior to the inception of the AGENT programme. After the CARE AGENT
programme intervention, the agents are on average stocking 6 varieties of seed and 4 varieties
of fertilisers as well as chemicals and other inputs such as implements, hand tools and general
hardware. Intermediate technology has also become easily accessible to farmers as a result of
linkages between the agents and manufacturers of these technologies. Equipment accessed
include peanut butter making machines, oil press machines, simple irrigation equipment and
candle making machines, which have enabled farmers to diversify their income options
through non-farm activities and value addition. This enables them to access higher value
markets. In terms of output marketing, the programme has conducted subsector analysis in
the grains and oil seeds sub sectors. In addition, pilot schemes for the marketing of maize,
sorghum and groundnuts have been developed. More work is being conducted, as this is a
work in progress.
Benefits of the project on the target beneficiaries:
The programme has increased the benefits accruing to participants in the following areas:
1. Farmers: increased income, increased access to inputs, reduced cost of inputs due to
economies of scale, exposure to agents, exposure to new technologies, risk
management for farmers.
2. Agents: increased business knowledge, improved access to credit, increased income,
3. Suppliers: increased information on rural markets, increased sales, sharing of market
development costs, increase in transport business on transporters in project areas.
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
Commentary: Over and above the usual appreciation extended by farmers, traders, suppliers
and the smallholder farmers union, the following remarks have been used to salute the
AGENT programme.



In his state of the nation address in 1999, the President of the State of Zimbabwe
hailed the AGENT programme as a flagship programme in the empowerment of
smallholder farmers.
Natural Resources Institute, 1999: The AGENT programme performance is
encouraging with high input sales and good repayments.
IFDC, 1999, A Strategic Framework for Inputs Marketing in SSA, p29: The
model case study for Nurturing Private-Sector Provision of Seasonal Input
Credits; The CARE-AGENT Experience in Zimbabwe.
5. Constraints
Labour and livelihood constraints:
There are challenges presented by the high HIV/AIDS prevalence in Zimbabwe with telling
effects on labour supply as well as distortion of income distribution patterns between rural
and urban areas as so many breadwinners have been lost to the pandemic. Over the last
couple of years fuel shortages have affected distribution of inputs to farmers. Coupled with
increasing costs of inputs, due to import inflation, and the generally depressed producer
prices, smallholder farmers are experiencing serious problems. The non-performing and
distorted credit markets have also limited investments in farming by smallholder farmers.
Policy Constraints: the government has come up with price controls on inputs and this risks
affecting the manufacturing sector and resulting in reduced supply of inputs on the market.
This is also compounded by the high tariff regime on fertiliser imports, which discourages
importation of fertilisers. The low producer prices of food crops affect smallholder viability
and buying power for inputs.
Private Sector Constraints: The country has a fixed exchange rate system, which currently
overvalues the local currency, thus affecting foreign exchange inflows. Inflation is rampant
and the fixed exchange rate makes local production expensive internationally and imports
expensive locally. Grave shortages of foreign exchange complicate the importation of key
raw materials for the manufacture of fertilisers.
Constraints arising from Market Dynamics: The country’s inflation has continued to be on
an upward surge closing at over 117% in January 2002. The exchange rate has remained
fixed at 55 to the USD. The government also imposes controls on export of fertilisers and
this causes supply bottlenecks as fertilisers can not be exported to earn foreign currency in
order to import more raw materials.
6. Lessons Learned
Responses to constraints, creative solutions to constraints: the AGENT programme is a
market model that addresses the structural, conduct and performance of agricultural markets.
The programme has demonstrated that an input supply mechanism based on market forces
alone is possible. The model also emphasises a win-win approach to the suppliers of inputs,
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
agents and farmers. The programme underpins a critical issue of private sector takeover of
agents. This involves the graduation of agents to private sector agreements after one
agricultural season of trading and the promise of increased credit limits once the initial
apprenticeship under NGO guidance is completed. The programme also shares the risk of
implementation with the private sector and agents and this reduces and even eliminates moral
hazard on the part of agents and suppliers. Other notable lessons relate to the selection of
agents, which works best when it is an open, competitive system and the training of agents,
which should include suppliers and successful agents. The agents should also pay for their
training. On the part of the private sector, it is also worth noting that they need assistance in
developing capacity in dealing with smallholder sector farmers. While efforts are channelled
at developing traders, the private sector needs to be nurtured in new skills as well.
Scaling up potential
There is great scope to widen the programme geographically. While this is good, it is ideal to
transfer the current in-house capacity to the private sector and assist it to develop in-house
capacity for developing rural distributorship models. The other areas, which need further
work, are those of output marketing efficiencies as well as improving the smallholder farmers
input use efficiency.
Institutional and Financial Sustainability
The programme sustainability lies in the sustained benefits to the players from the input
manufacturers, agents, farmers and commodity buyers as all parties profit from the linkages.
As has been demonstrated by the profitability of the suppliers and the agents in this
intervention, as well as the reduced costs of inputs to farmers in general, the programme
generates interesting returns to all players. The sustainability of linkages between agents and
suppliers has been very encouraging and the private sector has generally embraced a long
term relationship with AGENT trained traders. The continued sustainability lies in the
enhancement of returns to the farmers for their produce as well as the development of the
private sector capacity to take over the development and expansion of the model. The current
agrarian reform programme is also increasing the smallholder market and this increases the
impetus of the private sector to work with the programme.
Recommendations
The AGENT programme is currently striving to increase the private sector engagement in
extending the distribution network to areas where demand continues to outstrip supply. We
are working closely with the private sector in skills transfer and understanding of the benefits
accruing to suppliers. There is a great need to further develop the produce marketing
component in order to ensure sustained benefits for both farmers and the private sector.
Government has a key role to play in creating a viable and enabling macro-economic
environment in order to encourage private investment in smallholder agricultural
development. The current methodologies remain to be documented and best practices
synthesised for wider distribution and replication of the programme in other regions. CARE
believes that more resources must be channelled to these areas in order to stimulate demand
driven market access for the smallholder sector.
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
In conclusion, CARE Zimbabwe would like to take this opportunity to extend its profound
appreciation on behalf of the farmers for the donor support without which this ground
breaking programme, its related spin-offs and secondary adoptions would not have been
possible. IFAD is appreciated for funding the pilot phase of the programme . CARE
Zimbabwe also appreciates the funding for the current AGENT program activity undertaken
with the financial support of the Government of Canada provided through the Canadian
International Development Agency (CIDA). Appreciation is also extended to the Rockefeller
Foundation for the AGENT expansion in the south of Zimbabwe over the next two years.
Appendix: Map of AGENT Distribution in Zimbabwe and the Evolution of Models.
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE
AGENT PROGRAMME DEVELOPMENTS IN ZIMBABWE
PHASE 2 &3: 97-00
HARARE
PHASE 3:2001-TO
DATE
PILOT: 1995-96
DEVELOPMENTS IN AGRIBUSINESS IN ZIMBABWE
1990: GOVERNMENT ADOPTS ESAP AND LIBERALISES AGRICULTURAL
MARKETS IN ZIMBABWE
1995: CARE ZIMBABWE PILOTS AGENT PROGRAMME WITH GOVERNMENT
SUPPORT
1997: CARE ZIMBABWE EXPANDS AGENT PROGRAMME AND ELICITS
STRONG PRIVATE SECTOR SUPPORT
1997/98: OTHER NGOS START AGRIBUSINESS MODELS
(CNFA, SEDAP, ACFD, HASP, SDARMP)
1999/00: EXPANSION OF AGRIBUSINESS MODELS COUNTRYWIDE.
GOLDEN MAHOVE , AGRIBUSINESS PROGRAMME MANAGER, CARE ZIMBABWE