Crop insurance

Jul 24, 2025 Editorial, News

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Kaieteur News – After years of lobbying from the Rice Producers Association (RPA) and other stakeholders, the Guyana Government on Tuesday launched a crop insurance initiative- a most welcomed programme that will benefit some 6000 farmers across the country.

According to a Department of Public Information release, for the next three years, more than 6000 rice farmers will have access to insurance for their crops, without having to pay a cent on premiums. At the launch held in Anna Regina President Ali called on the banks to recognise the government’s effort to reduce the risks associated with agriculture, noting that this must be reflected by the reduction of interest rates for agricultural activities.

“We’re challenging the bank now. With this insurance, the risk is reduced, and the cost of lending to our farmers must reduce substantially,” the president stated. Also, at the launch Minister of Agriculture Zulfikar Mustapha that Guyana is now the first country in the Caribbean to offer this kind of service to its farmers.

Agriculture remains an important economic sector in Guyana and it is a source of growth and investment opportunities for the private sector. According to World Bank, two-thirds of the world’s agricultural value added is estimated to be created in developing countries.  It added that, in agriculture-based economies, which include most of Sub-Saharan Africa, agriculture generates 29 percent of GDP on average and in transforming countries—countries in which agriculture is no longer a major source of economic growth, which include most of South and East Asia and the Middle East and North Africa—the contribution of agriculture to GDP is much lower.

Additionally, nearly half of the world’s population—some 2.9 billion people—live in rural areas. Agriculture is a source of livelihood for an estimated 86 percent of these people. It provides employment to 68 percent of the population in agriculture-based countries and 48 percent in transforming economies. About 94 percent of rural households live from their agricultural activities in agricultural-based countries; this proportion falls to 76 percent in transforming economies, the bank said.

In Guyana for years, rice farming has been one of the cornerstones of the economy. From the paddies of Region Two to the expansive fields of Berbice, thousands of hardworking farmers rise each day to produce the grain that feeds our people and fuels our exports. But year after year, these men and women face silent and unpredictable threats such as extreme weather, pests, disease, and shifting market dynamics. For too long, a single flood or dry spell has meant the loss of an entire season’s livelihood. It is against this background that the RPA had been over the years constantly lobbying government provide crop insurance to farmers.

With the inflows from oil, it is the prudent thing for the government to do in kickstarting this initiative by paying the premiums for the next three years. It would be interesting however, to see how the farmers themselves approach this going forward as they could not expect the state to pay their insurance premiums for life. Note must be taken too, that there was no mention of how much this initiative will cost and the timing of its launch so close to general elections could only be seen as part of the administration’s campaign for reelection. The rice farmers are a key constituency for the ruling party and stirring the pot with this initiative would no doubt buy some votes.

Notwithstanding the introduction of crop insurance for rice farmers is not only welcome, but also essential. Crop insurance brings a layer of protection and peace of mind that Guyanese farmers have long deserved. It will transform uncertainty into stability, replacing helplessness with hope. With the right policies in place, a farmer no longer faces ruin after a natural disaster; instead, he or she can receive timely compensation, recover quickly, and return to planting with confidence.

Moreover, crop insurance encourages smarter, more resilient farming. It can be paired with climate-smart practices and incentivize farmers to follow better land management and flood mitigation strategies. It also makes access to credit easier, because with insurance backing their operations, farmers are seen as lower-risk borrowers by banks and financial institutions.

There’s also a broader national benefit as well, as crop insurance reduces the financial shocks to individual farmers, it stabilises rice production and prices across the country. This contributes to national food security, rural employment, and sustained export revenue.

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• Crop insurance, Editorial, Guyana Agriculture, Rice Producers Association, Zulfikar Mustapha

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