Small banana farmers seek interest-free loans to recover from 'Pablo'

Small banana growers are appealing for government support in asking lending institutions to allow interest-free loans for two years to small farmers whose plantations were damaged by Typhoon "Pablo" (Bopha). “We are appealing to the Department of Agriculture to help us gain financing access to banks,” said Romy Garcia, president of Mindanao Banana Growers and Exporters Association, in an interview Monday. Garcia said with the damage to agriculture caused by the typhoon earlier this month, it will take them about two years to totally rehabilitate their farming areas. “We will not have the means to repay the loan in about two years,” he said. Mindanao’s banana industry suffered the biggest blow after Typhoon Pablo ravaged a large area of banana plantation on the island. Based on government estimates, damages to the sector are now close to P8 billion.   The group is planning to ask banks to allow farmers a seven-year term loan with a grace period of two years where they will not pay the interest, the principal and any other forms of surcharges. Payment should kick in on the third year of loan, which should be subject to an interest rate of 3 percent.   Garcia said that farmers are seeking as much as P400,000 per hectare of financing from banks.   Based on recent estimates, the group sees as much as P5.6 billion worth of financing to restore damaged plantations. This is on top of the estimated production loss of P8 billion only for Cavendish banana in Mindanao.   “Most of the farms are totally knocked down,” Garcia said. “It is not so much as how little we are going to produce in the next months or years, but how can we, in the light of the destruction, move forward without any assistance from the government. The bigger problem is how to get back.”   He said that should banks decide to provide financing assistance, farmers will ask for a two-year moratorium on loans “since the industry is yet to start production. “There will be no harvest in the first two years,” Garcia pointed out. — KBK, GMA News