The report called for new investment strategies clearly articulating the investment needed by governments, farmers, co-operatives and agribusinesses in each country’s agricultural sector. AgBiz’s CEO, Dr John Purchase, said that SA had many positives, including macro-economic stability, generally good governance in the public and private sectors, and effective market institutions and arrangements, which benefited investment growth in the country’s agricultural sector.
However, Purchase said that negative factors needing to be addressed for the benefit of investment in SA agriculture related to policy matters and service delivery issues from the public sector, as well as bringing more people, especially previously disadvantaged smallholder farmers, into commercial agriculture value chains.
“The most significant negative in the current South African context relates to insecure property rights in the case of both large-scale commercial farmers and smallholders, given certain proposals emanating from the Land Reform Green Paper process of government,” Purchase told Farmer’s Weekly. “A further concern has been the sword of nationalisation of farm land hanging over the agricultural industry.”
AgBiz said it hoped that a resolution discarding proposed nationalisation policies at the recent ANC Mangaung Conference would establish greater certainty and predictability on the issue. Palesa Mokomele, spokesperson for Tina Joemat-Pettersson, minister of Agriculture, Forestry and Fisheries, said that SA was a major food producer in Africa and globally. This was largely thanks to the department having made strides in facilitating finance and investment opportunities to commercial and smallholder farmers, through Land Bank and other commercial banks.
“The department views assistance to farmers beyond being limited to finance, but includes investment in our climate in order to sustain and preserve our sector for future generations,” said Mokomele. The department said that it had been able to work with private sector partners to enhance support and investment to smallholder farmers in particular.
Meanwhile, Purchase indicated that the FAO report had a number of key messages worth repeating in the light of SA’s complex political and investment situation in the agricultural sector. One of these messages noted that investing in agriculture was an effective strategy for reducing poverty and hunger and promoting sustainability. Another was that farmers were, by far, the largest source of investment in agriculture. A third was that a favourable investment climate was indispensable for investment in agriculture.
“Government and donors have a special responsibility to help smallholders overcome barriers to savings and investment,” Purchase said. “Government and donors also need to channel scarce public funds towards the provision of essential public goods with high economic and social returns.”