Rural reform through co-ops

The UN has proclaimed 2012 the International Year of Co-operatives and, according to Langa Zita, director-general of the department of agriculture, co-ops are central to agricultural development.

"Co-operatives are central to our mission of promoting agricultural development, rural job creation, and food security, because one of the key aspects of our agrarian reform programme is the promotion of our smallholder sector. Without a vibrant smallholder sector, there’s little hope for rural development in this country.

Smallholder agriculture must form the basis of rural development, particularly within the former homelands. The land is there, the people are there; even the demand for food is there. But, by and large, successful farmers in these areas are few and far between, and most of the food consumed is brought in.

What is holding us back? Many things, and we’re presently trying to make changes on a number of fronts at the same time. This isn’t easy. When it comes to co-operatives, part of our problem is that we haven’t always been clear as to what function they serve. We know they can be good and we readily agree they’re essential – but because we don’t always understand why we need them, we support them in sometimes arbitrary or inappropriate ways.

And then, not surprisingly, we don’t get the results we want. So why do we still bother? One reason is because we see the importance of co-operatives elsewhere – in Brazil, China, India, Spain, Italy, Greece, Kenya, Uganda and Tanzania for example.

Agrarian reform
The mobilisation of smallholder farmers into functional co-operatives is key to achieving our goals, but we have to do better than we’ve done thus far. I’m told there are 836 co-ops on the department of agriculture’s Co-Operative Data Analysis System. Of these, only about 200 can be regarded as functional.

If these 200 were vibrant co-ops with many members, that would be one thing. But I understand the vast majority are production co-ops, where individuals come together to farm as a group. Sometimes this works, but mostly, it doesn’t. Let’s look at this more closely. What is agrarian reform? It’s not simply replacing large-scale white farmers with some large-scale black farmers, although this may be part of it.

By the same token, it’s not merely replacing a large-scale white farmer with a co-operative composed of black members. Land redistribution has attempted to do precisely this, and we’ve seen the results. Where land redistribution projects did not completely collapse, they carried on with the same capital-intensive farm plan as the previous farmer used. This is a kind of cosmetic agrarian reform that doesn’t promote the advantages of smallholder farming, namely labour-intensity and higher land productivity.

Marketing co-ops
So if we don’t want production co-operatives, what kind of co-operatives do we want? We want co-ops that compensate for the disadvantages of being small. We want co-ops that ease farmers’ access to affordable inputs and financial services, and help farmers participate in marketing opportunities. The general term for these is marketing co-operatives, although there are a number of variations in terms of emphasis or specific function.

The idea is to allow smallholders to enjoy the advantages of participating in an organisation which provides mutual support in critical functions that small-scale farmers otherwise struggle with. This will allow existing smallholders to thrive and more rural dwellers to join the ranks of the smallholder sector. We need to explore what we must do to support the emergence of more, and stronger, marketing co-operatives.

What exactly should these co-ops look like? Who should do what? What tools do we have at our disposal for this work, and what tools do we still need to develop? We’ve created the Zero Hunger Programme in order to fast-track efforts to address dual problems of rural under-development and food insecurity.

The programme seeks to guarantee a market for smallholders by buying government food requirements from them. This includes food for hospitals, schools, prisons and so forth. The bulk of the food should be procured entirely from smallholder farmers, which will serve to revive our rural economy.

Large-scale farming
At the same time we should ask whether a reinvigorated co-op strategy could also hold the key to addressing the ills that affect our commercial farming sector. After all, it was largely thanks to co-ops that white commercial farming became such a dynamic sector in South Africa in the past. With the disappearance of these co-ops, we saw the end of many smaller commercial farms. Their demise has meant increasing rural unemployment.

So, although we see that a co-operative’s strategy is of particular relevance to the smallholder agenda and the Zero Hunger Programme, we should be asking questions as to its applicability elsewhere. This could have implications for the type of co-operatives we want to promote. The UN has proclaimed 2012 the International Year of Co-operatives, with the slogan ‘Co-operatives Build a Better World’.

In my humble view, co-ops cannot lead to a better world unless they’re properly organised, so that all key role players can play their part. Adapted from the keynote address delivered by the director-general of the department of agriculture at the recent National Agricultural Co-operatives Indaba.

The views expressed in our weekly opinion piece do not necessarily reflect those of Farmer’s Weekly."