Operationalizing existing SA agriculture policy key for growth and job creation

Operationalizing existing SA agriculture policy key for growth and job creation

South Africa’s agricultural policy growth path has been clear as far back as 2012 when the National Development Plan (NDP) sketched higher growth potential and labour-intensive sub-sectors that could create jobs and increase the sector’s contribution to GDP. One such subsector was horticulture, which, among others, had the capacity to grow and create employment along the value-chain, including off-farm and in agro-processing.

Seven years after the NDP was crafted, nothing has fundamentally changed this viewpoint, and if anything, the global demand for the horticulture and protein-rich food products has increased notably over this period. With this, South Africa’s agricultural exports have also increased, having amounted to US$10.6 billion in 2018, representing a 17% increase from 2012, a year of the release of the NDP.

The gains have largely been underpinned by the subsectors that were identified as potential drivers of South Africa’s agricultural economy – namely the horticulture as already discussed, as well as wine, grains, amongst others. But the growth in exports has not been evenly distributed from a geographic and spatial point of view.  In fact, growth has been concentrated in traditionally agriculture active areas, while the former homelands have seen sporadic improvement over time.

In my field visits in the Eastern Cape last week, where I interacted mainly with new generation farmers with an objective of understanding the developments at farm level in the province, the constraints that came out repeatedly were not different from those expressed by agribusiness firms and farmers in other provinces. These included the lack of access to finance, challenges regarding land governance in the communal areas, access to water, need for farming advice (effective extension services) and poor infrastructure.

This means if South Africa is to attain its rural economic growth and job creation ambitions, the country does not need to re-invent the already stated vision of creating vibrant rural economies. Rather, the focus needs to be on crafting specific strategies which seek to resolve the prevailing constraints that hinder progress, such as the aforementioned ones from Eastern Cape’s farmers.

Targeting specific bottlenecks entails effective coordination between the established agribusinesses, farming enterprises, communities and also government (national and local).

This approach is premised on the assumption that there is universal buy-in on the vision articulated in the NDP. However, often times, the message and vision at national government levels by political captains of various departments have not been received with the same level of enthusiasm at local government levels. This is an area which requires improvement.

Agribusinesses and farmers have in various forums expressed a willingness to collaborate with the government in growing South Africa’s agricultural sector. This willingness should be welcomed as it promises to address some of the challenges that currently exist at the farm level, such as skills transfer, access to finance and also links to market, amongst others.

There are areas where this approach has started to bear fruits. Within the Eastern Cape province, the blended finance approach of the provincial government, has sparked agricultural development in lands that were underutilised for decades, and thus increasing value and creating extra jobs.[1] In the Free State province, livestock farmers have also started collaborating with emerging black farmers with an aim to bring them into the formal market and growing the industry. The government has also supported some of the initiatives through the Jobs Fund.[2]

Fortunately, this public-private partnership approach has been revived in government policies, with the National Treasury’s recent economic policy discussion paper highlighting the need for a joint-venture approach to drive development in South Africa’s agricultural sector. This should receive increased focus in the coming months as its success would ensure that the bigger ambitions articulated in policy papers actually translate to development at farm level and communities.

There are, of course, broader policy questions such as land reform policy and water rights which will need to be attended to concurrently with the other development strategies. Even these specific areas require realization, in order to attract investment into agriculture, that property rights are key.

Overall, the path for growth and job creation has been clear for some time. What is needed is an increased effort in coordinating strategies and programs that address specific constraints and bottlenecks, which will deliver the bigger goal.

[1] Here we are specifically referring to the Co-Op (an agribusiness) development projects, which cover citrus, lucerne, pineapples, livestock, blueberries and papers, amongst other agricultural commodities.

[2] We are specifically referring to the Sernick Group (an agribusiness) development initiatives.

Follow me on Twitter (@WandileSihlobo). E-mail: wandile@agbiz.co.za

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