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Wednesday, August 17, 2022

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Agbiz says ANC must focus on land reform to grow the sector

Agbiz believes that the focus should be on the Land Reform and Agricultural Development Agency to drive land redistribution. Picture: Karen Sandison (ANA)

Agbiz believes that the focus should be on the Land Reform and Agricultural Development Agency to drive land redistribution. Picture: Karen Sandison (ANA)

Published Aug 2, 2022


Moving away from land expropriation, as outlined in the ANC 2017 policy conference, would be a welcome development and positive for the country, according to Agricultural Business Chamber (Agbiz) chief economist, Wandile Sihlobo.

He said they believed that the focus should be on the Land Reform and Agricultural Development Agency to drive land redistribution.

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“We feel this could be done more effectively provided that the agency is correctly set up and supported with the right skills and budget. This is what we hope to hear from the Minister of Agriculture, Land Reform and Rural Development,” Sihlobo said.

He said the ANC papers acknowledge that the growth of the agricultural sector partly depended on effective land reform, which was partly about bringing underutilised land into production.

Here the emphasis was on the Land Reform and Agricultural Development Agency, first announced by President Cyril Ramaphosa last year and more recently in the State of the Nation Address this year.

The details of this agency were yet to be made clear, but Agbiz said it understood there was work under way to structure it under the leadership of the Minister of Agriculture, Land Reform and Rural Development.

Sihlobo said for land reform to be successful and for South African agriculture to experience inclusive growth, it was critical to deal immediately with the deterioration of infrastructure across all provinces – road, rail, water, electricity and ports.

This at a time when the country emerged from a policy-oriented weekend, where the governing ANC gathered to discuss their policy ideas ahead of the December elective conference.

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Sihlobo said there was a range of economic matters discussed at the conference whose outcomes they would learn more about in the coming days.

Prior to this conference, the ANC had released policy discussion papers, which noted that “agriculture remains an important sector of the South African economy. It holds the potential to uplift many poor South Africans out of poverty through increased food production, vibrant economic activity and job creation”.

Sihlobo said this view that Agbiz shared was aligned with empirical research from Luc Christiaensen and Will Martin first published in World Development in 2018, which found that, on average, growth in agriculture was more poverty-reducing than an equivalent amount of growth outside agriculture.

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This was also consistent with the views expressed in the Agriculture and Agro-processing Master Plan, a social compact approach which broadly aimed to boost inclusive growth and job creation in agriculture and agro-processing.

Agbiz said another growing challenge, which the ANC did not reflect on at the time of releasing its policy discussion papers, was the need to expand export markets for various agricultural produce while retaining the existing ones.

This had become ever more important as the country continued to see the disruption of South African agricultural exports in the likes of the EU (with citrus export), and China, with South Africa’s wool exports.

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“While the political party might not be direct on specific countries and challenges, we would still like to see an emphasis and commitment to the expansion of the export markets. The above-mentioned logistical improvements would help support the facilitation of such exports.

“Moreover, agricultural finance is another area crucial for supporting agriculture, specifically the new entrants to farming. Thus, the government and governing party supporting the Land Bank, and various financial instruments such as blended finance are critical for the growth of the sector,” it said.

Sihlobo said Agbiz looked forward to the official documents from the conference that might align or deviate from the aspects mentioned above that they deduced from the papers published ahead of the summit.

He emphasised that many of the actions needed to promote further growth in the sector did not need to wait for the ANC policy documents.

“They are all ‘low-hanging fruit’, which require actions by the government. Some involve the following critical areas of animal health and diseases, logistical constraints and ports and rail, fixing provincial roads, dealing with backlog in agricultural input regulations, non-tariff measures in major export markets, and investment in water infrastructure,” Sihlobo said.