A benefit-cost analysis of smallholder irrigated farms in Zimbabwe

The government of Zimbabwe uses agricultural development as one of the ways to stimulate economic growth. Agriculture in Zimbabwe is characterized by a dual agrarian system comprising the large scale commercial sector and the smallholder communal sector. The communal sector, 47 percent of the country, supports more than 70 percent of the population. One strategy used to improve agricultural performance is the development of agricultural infrastructure. Of the 117, 830 ha developed for irrigation only slightly more than 6 percent is in the communal (smallholder) sector. The smallholder irrigation systems are managed under four different systems, namely the government-managed Agritex, farmer-managed community, the informal bani (dambo) managed by farmers and the ARDA outgrowers managed jointly by a parastatal and farmers. This paper evaluates the benefits and costs associated with these different management systems. Benefit-cost ratios are computed for each system. The bani system achieves higher benefit-cost ratios than the community, which achieves higher ratios than the Agritex management system. This indicates that the government should consider using the community system for developing the potential 93,000 ha of communal smallholder irrigation systems. It should also seriously consider the bani system as an alternative development strategy.