Nene spells out greater role for Land Bank in agri transformation

Finance minister Nhlanhla Nene has great expectations for agriculture. In the 2015 budget speech delivered in Parliament today (25 February), the farming sector was one of nine he singled out as “strategic priorities” in a bid by government to speed up economic growth and employment creation.

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Government would continue to strengthen support for agricultural development and trade, while emerging farmers’ access to financing would be expanded in collaboration with Land Bank, said Nene.

In an interview with Farmer’s Weekly earlier this month, agriculture minister Senzeni Zokwana said government was looking at positioning Land Bank to provide “soft loans” to emerging farmers to speed up transformation in the sector.

This was reflected in the 2015 budget with Nene saying an organisational review of Land Bank would be conducted to enhance the bank’s support for emerging farmers and commercial agriculture.

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Development finance institutions such as Land Bank, the Industrial Development Corporation and the Development Bank of Southern Africa would expand their loan portfolios by about 33% over the next two years, including substantial investments in renewable energy, agriculture and industrial infrastructure, said Nene.

“Of special importance is Land Bank’s collaboration with the Department of Rural Development and Land Reform to bring rural land restitution and redistribution projects to full production,” he said.

Through its retail emerging markets programme, Land Bank has already financed more than 400 projects and created 7 000 employment opportunities, without any defaults, said the minister.

Over the medium term, access to financial resources for smallholder farmers would be expanded through an allocation of R50 million in 2016/2017 to Land Bank’s emerging retail markets programme to support more than 5 500 black emerging farmers through low interest loans, according to the 2015 Estimates of National Expenditure, issued by Treasury.