I am back from Germany adventures and had planned to spend a day or two discussing a few things I have learned over the past few days, but there are more pressing issues on the domestic front.
This morning President Cyril Ramaphosa tabled the government’s economic stimulus and recovery plan. The plan entails a range of measures covering a number of sectors, which will be implemented immediately. This is aimed at igniting economic activity, restoring investor confidence, preventing further job losses and creating new jobs.
From an agricultural perspective, here are the key points the President made and my brief commentary thereafter.
- “Agriculture has massive potential for job creation in the immediate and long-term.
- The interventions we have identified will include a package of support measures for black commercial farmers so as to, increase their entry into food value chains through access to infrastructures like abattoirs and feedlots.
- Blended finance will be mobilised from the Land Bank, Industrial Development Corporation and commercial banks.
- The Land Bank is currently concluding transactions that will create employment opportunities in the agricultural sector over the next three to five years.
- A significant portion of the funding will go towards export-oriented crops that are highly labour intensive.
- The government will finalise the signing of 30 years leases to enable farmers to mobilise funding for agricultural development.
- As part of the work to develop agriculture and ensure effective land reform, the President has appointed an advisory panel on land reform that will guide the Inter-Ministerial Committee on Land Reform chaired by Deputy President David Mabuza.
- The 10-person panel, which I am part of, is to advise the government on the implementation of a fair and equitable land reform process that redresses the injustices of the past, increases agricultural output, promotes economic growth and protects food security.”
Broadly speaking, these are encouraging developments, and to some extent, in line with the theme of Chapter six of the National Development Plan. I have previously discussed the role of agriculture in job creation, and to bring underutilised land in communal areas and land reform farms into commercial production, expand irrigation systems and identify and support agricultural expansion in areas that have a high potential for growth and employment. This will require investment and strong and efficient institutions. I have hyperlinked the article that explains this statement, you can read more here.
Above all, the current land reform discussions and the direction the policy will take will be a key determinant of the success of the President’s proposed action points of stimulating the South African agricultural economy and the economy at large.
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