CREDIT FINANCING OF THE DEVELOPING COUNTRIES AGRICULTURE
VLADIMIR JENICEK, FEKADU SHAPA
Abstract:
Where agriculture always has been the basic means
of livelihood of most of the population, there exists a need to solve the problem
of this sector of economy, while it is necessary to focus attention at the still
growing demand for food and raw materials, including other necessary elements
connected with the given sectors development.
Agriculture cannot develop, as long as there do not exist sufficient capital
resources ensuring modern technology. In other words, very low inputs (costs)
lead to very low outputs with alow quality and little competitiveness. Therefore,
it is necessary, for improving agricultural productivity and the incomes of
rural proletariat, to extend the vital financial resources for purchasing tools
and agricultural implements. Reachig of this goal in the third world demands
the reform of:
1. credit system :
- price policy in agriculture
- development of cooperation and the informal sectors motivation
2. extension of infrastructure:
- education
- information
- market
- distribution services
- material support of the formal and informal financial branches
- creation ofagrar credit policy and programs
- strengthening of the control mechanism with minimalization of non-repaying
of credits
- political stability
Key words:
Developing countries, banking, agrar credits, credit
management, formal and informal financial institutions