SA’s Agriculture Sector Ripe for Action
Progress in SA’s agriculture sector
“There is so much in the implementation pipeline of South Africa’s agriculture policy this year. The past four years have largely seen various initiatives that sought to inject confidence into the sector. These are now ripe for implementation, especially ahead of the 2024 general elections” writes Wandile Sihlobo, chief economist of Agbiz.
Agbiz chief economist and author, Wandile Sihlobo.
A major development in recent times was the launch of the Agriculture and Agro-processing Master Plan, which offers the government and the private sector new possibilities to grow the sector, build competitiveness, attract more investment and ensure inclusion.
More concretely, the department of agriculture, land reform and rural development has finally launched a blended finance instrument that had been in the works for a few years. This is a joint initiative with the Land Bank and the aim is to broaden participation by other financing agencies to achieve the required scale to make a positive dent in transforming the sector.
During various addresses, President Cyril Ramaphosa has underlined the soon-to-be-launched Agricultural Development and Land Reform Agency under the leadership of the department’s minister, Thoko Didiza.
In the past, these programmes seemed like a pipe dream. Now they are nearing implementation. There is a window of opportunity for the government to show results in these areas since they are beyond policy development and ripe for action. If implemented effectively, these programmes could boost growth in the sector, sustain employment and even attract new investment.
Implementation is crucial
This year the focus should be firmly on implementation. Admittedly, to some stakeholders it may feel as if there has been little progress on the above programmes since the year started. The deterioration in the electricity crisis has been a major cause of the delay. To this end, I hope Didiza’s agriculture energy task team’s report is soon tabled to the sector to provide guidance on practical near-term interventions to limit the damage the crisis is doing to intensive energy-consuming farming businesses.
Photo: Food For Mzanzi
As interventions to mitigate the energy crisis are ramped up, more effort should be directed towards widening the blended finance to include a diverse range of other financial organisations, as well as identifying financing gaps that were previously unforeseen.
It is important throughout the implementation of the various government programmes that the relationship between the government and the private sector is strengthened since it is not possible to achieve any meaningful outcomes without collaboration. For example, the success of the Agriculture and Agro-processing Master Plan depends on the accessibility of affordable finance for new-entrant farmers and agro-processing entrepreneurs.
The opportunity to act is now
Simultaneously, the department will need to launch its Agricultural Development and Land Reform Agency, outlining its mandate and working plan for the first five years in collaboration with the private sector. Given that new entrant farmers to the sector will require access to land with title deeds or tradable long-term leases, launching the agency is a prerequisite for the comprehensive implementation of the Agriculture and Agro-processing Master Plan.
New entrant farmers require access to land with title deeds or tradable long-term leases
If the department fails to launch the agency in good time, the deliberations in implementing the master plan will always go back to land needs as a hindrance. Therefore, the government should unlock all these possible stoppages before advocating for a comprehensive implementation of the plan, possibly in the second half of this year. The master plan’s technical team could use the remaining four months of the first half of this year to resolve outstanding matters that social partners such as labour were not comfortable signing off on last year.
These implementation steps are also vital for building trust and progress in the sector, not just between government and existing participants but also to include other South Africans who aspire to join the sector and have followed these programmes from inception in the hope of finding economic opportunities. Notably, the sector’s stakeholders will also be more appreciative of the seriousness of government programmes and policy if there is a full-scale implementation of all these programmes.
Article Source: https://www.foodformzansi.co.za/sas-agriculture-sector-is-now-ripe-for-action/
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