Farmers' loan offer to help them grow

ABU DHABI // Farmers are being offered loans to convert to hydroponics to grow fruit and vegetables using less water and energy.

The Khalifa Fund for Enterprise Development, an Abu Dhabi government organisation that helps develop the emirate's businesses, has provided almost Dh650 million in financial support since it launched five years ago. It has been testing various "social entrepreneurship" programmes for Emirati entrepreneurs, farmers and fishermen, among others.

One of the programmes was launched two months ago with the Farmers' Services Centre, a government body that has the task of modernising farms in Abu Dhabi emirate.

"We partnered with the centre to support all farmers across the UAE to use their expertise and knowledge in the field," said Fatema Mohammed, the fund's senior business counsellor in entrepreneurship development. "It's one of our priorities to support agriculture across the UAE."

The fund also financed an aquaponics project last year in Baniyas, the largest of its kind in the world. The technique combines traditional aquaculture - fish reared in tanks - with a system that uses fish waste as fertiliser for its hydroponic vegetable tanks.

Hydroponics is a method of growing plants using mineral nutrient solutions in water, without soil.

The government programme is focusing its attention on farmers, offering them loans up to Dh3m.

"Anything above that must be contributed by the applicant," Ms Mohammed said.

To apply for the loan, farmers must own a licensed property and have a source of water.

"It's impossible to start a business without a source of water because farmers will have to bring water tanks, which becomes too expensive," said Ms Mohammed. "Some farmers close to Al Ain don't have a source of water."

Most of the loan applicants are in Al Gharbia, also known as the western region.

Ms Mohammed said those seeking the loan must have more of an incentive than "just making money. They cannot just be an investor, they must know their farm and want to produce food".

The farmers must be Emiratis, and they are not allowed to have an expatriate business partner. They must complete an application form at the fund, where a business model is then drafted. The application is then sent to the Farmers' Services Centre, which advises on the technical aspects and provides its view of the project.

"They then conduct a site visit and we decide how much it should cost," Ms Mohammed said.

Most farmers in Al Gharbia are enthusiastic about receiving a loan to be able to convert their farms from conventional to modern.

"Farmers are keen on it, and we want to encourage hydroponics on all Abu Dhabi farms, to be able to produce food all year round," said Dr Robert Caudwell, the centre's technical development manager.

If a farmer needs more money, the fund is open to studying his case.

One of the projects for which the fund is awaiting approval is a Dh1m rabbit farm in Al Khatam, between Abu Dhabi and Dubai.

Approval generally takes at least two months. If a project requires more than Dh1m, it would need the board's approval, in which case it could be longer than two months.

Farmers must start repaying monthly instalments after two years, and their farm will stay under the fund's monitor for five years.

So far, the fund has approved 21 projects costing up to Dh32.5m. It plans to bring more on board.

"Other organisations usually tell Emiratis to get their loan from the bank," said Ms Mohammed.

"We believe there is a shortage of funding for farmers and fishermen, and it's our social responsibility to develop agriculture. It's not in our interest to make people rich, but to build up the country's agricultural sector."

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