THE Jamaica Agricultural Society (JAS) is seeking a six-month moratorium on existing loans from the Development Bank of Jamaica (DBJ) to farmers affected by Hurricane Dean.

In a letter to the managing director of the bank, Milverton Reynolds, JAS president Norman Grant said that an immediate moratorium would greatly assist the recovery of the farm areas ravaged by Dean last weekend.

Grant also proposed a rescheduling of all existing agricultural loans to farmers adversely affected by the hurricane, as well as the introduction of a special line of funding for the construction of greenhouses, similar to those used for tunnel ventilation houses for poultry.

“The construction of modern greenhouses for the growing of vegetables could cost approximately $1.5m each, but they can be constructed to withstand category four hurricanes. This type of investment could, in the long run, save the agricultural sector from the levels of damage recently experienced,” the JAS president said.

He said that the JAS would also welcome a crop lien arrangement of collateral for loans.

“This would require a higher level of risk management than when registered titles are used for collateral. The acceptance of this recommendation by the Development Bank of Jamaica could lead to a rapid recovery pace of the sector, as a number of farmers would be able to access loans in the recovery process,” he added.

Grant’s proposals have come in the wake of the decision by the DBJ, last week, to introduce a special emergency loan fund of $100 million to assist farmers affected by the hurricane.

The DBJ says that it is making the funds available through the 40 branches of the People’s Cooperative Bank, islandwide. It also said that the objective is to ensure that the country’s farming sector receives as much help and assistance as possible, to restore agricultural production in the shortest possible time.

Grant said that the JAS fully endorsed the loan fund, and the fact that the interest rate will be 7.8 per cent per annum on the reducing balance basis. However, he has suggested that a maximum repayment period of seven to 10 years be considered, with at least a nine-month moratorium on both interest and prinicipal.

“This move by the DBJ would be another demonstration of the vital importance placed on agriculture,” he said.

He said that the JAS has appointed a team which it hopes will be able to meet with representatives of the bank, at the earliest possible time to discuss the issues.

In January, the House of Representatives approved a Government guarantee for a loan of $600 million from the Bank of Nova Scotia to the DBJ for on-lending to the agricultural and tourism sectors.

The DBJ said that the new facility would be a separate one, and that it is prepared to look at restructuring current loans to facilitate easier payment by farmers as they recover from the hurricane.

Agriculture minister Roger Clarke last week confirmed that considerable damage had been done to banana cultivations in the eastern end of the island, as well as vegetable farming on the south coast, both of which were battered by winds from Hurricane Dean which hit Jamaica on August 19.

Clarke also said that an emergency programme would have to be implemented for the distribution of fertiliser, which is in very short supply and attracting high prices.