SOUTH Africa’s agricultural sector has more than doubled in value and volume since 1994, thanks to improved productivity. Yet the sector, which employs about 1,4 million people, could create another million jobs if the government started transferring land it is currently holding to deserving farmers.
This is the view of Wandile Sihlobo, chief economist of the Agricultural Business Chamber of South Africa (Agbiz), who said that, despite challenges, the agricultural sector has enjoyed three to four years of good conditions.
“There are nearly a million people working in the primary agricultural sector – which is up from about 700 000 jobs in 2012. The expansion has been in a number of value chains, including blueberries, avocados and other fruits and vegetables, as well as the processing and packaging associated with that.
“The agroprocessing sector itself has become more robust in recent years, with about 450 000 people employed in that sector alone.”
However, Sihlobo, who is also a member of President Cyril Ramaphosa’s Economic Advisory Council as well as the Advisory Panel on Land Reform and Agriculture, indicated that the SA’s agricultural sector has a “vast tract of under-used land” which is in government hands, and if released this could grow the “agricultural pie” considerably. Government has been buying land on the open market across all provinces since 2006 – and has acquired 2,5 million hectares of land still pending transfer of title deeds. Acquiring title deeds would secure ownership and help farmers to access financing.
“The land has been fully surveyed and is sitting in the department of Agriculture’s landholding account,” he said. “To give perspective (on how big 2,5 hectares is) – all the grains and oil seeds that SA produces today, is produced on about 4,3 million hectares of land. Imagine the profile of the output of 2,5 million hectares if you could bring this under-utilised land under food production.
“The inclusiveness we talk about has to be on those new hectares which could potentially increase the gross value add of the agricultural sector by between 15% and 30% by 2030. To achieve this there must be collaboration between the government and the private sector.”
Sihlobo said the hope is that the government will, next year, launch the land reform agency, an initiative announced by President Cyril Ramaphosa in his 2022 state of the nation address and which will be responsible for the release of land, “hopefully with title deeds”. This would be done progressively as beneficiaries are selected and due diligence is done and in line with the government’s Agriculture and Agro-processing Master Plan (AAMP)
“The structuring of the agency is on track and has the support of the president and the Agriculture minister. Criteria have now been set which determine who can become beneficiaries.”
Sihlobo said: “There are two major things we have done well in South Africa, for which we should give the government the credit it deserves: better technologies allowing for higher productivity in the farming sector across the value chain and, secondly, the opening up of the export market which has created the demand pull approach for the number of products that we are producing.
“All of this has been achieved by the private sector, in conjunction with the government. You don’t open the markets alone. To do business with the US, the SA government accompanied by the business must be in the discussion.
“Better technologies to use on the farm have to be legislated by the regulators in SA, who make the environment favourable for companies to bring those technologies here.”
He concluded that there was a need to “think about South African agriculture in the way we think about mining and finance etc” because the sector is just as important in terms of delivering much-needed growth to the country.
“If the agricultural sector grows, it is two to three times more effective in eradicating poverty than any other sector in the economy.”
