S.Africa needs to prioritise on agriculture in mid-term budget - CNBC Africa

S.Africa needs to prioritise on agriculture in mid-term budget

Southern Africa

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Farm Irrigation

Ahead of South African finance minister, Pravin Gordhan’s medium term budget speech on Wednesday, the National Treasury’s Adjusted Estimates of National Expenditure mid-year performance status showed that 6,012 smallholder farmers had been supported in the first six months of the 2013/2014 period. 

“Food security has a number of elements to it. There’s the element of national food security but then there’s also household food security – this is where government’s focus on smallholders is important, to try and ensure that they get the support to produce more efficiently for themselves,” the Sothern Africa Agricultural Business Chamber chief executive John Purchase told ABN Digital.   

“Smallholders and developing farmers are only producing in the region of between five and 10 per cent of total produce in the country but one must remember that it’s actually broader than that – the issue of household food security is critical for these people and for their families.” 

While the projected number for the 2013/2014 period, as published in the initial Estimates of National Expenditure, is 16,500 smallholder farmers, employment, as a whole, increased by 274,229 jobs in the year to July – this included estimates of hiring in the agriculture and informal sector. 

“What we are seeing from government is greater support for agriculture, which in the past was not there. It will take time for that greater support to translate into significant growth in the sector. They are rolling out certain plans to support smallholder producers,” Purchase indicated. 

According to the Medium Term Budget Policy Statement, aside from improving the integration of small-scale farmers through financial support, the agricultural sector should also benefit from continued African market growth, improved water resource management, and the resolution of outstanding land claims.    

Agricultural output grew by 3.6 per cent in the first half of 2013 compared to the same period last year and Purchase believes that encouraging more smallholder farmers to produce consistently and cost-effectively could also aid in growing the agricultural space. 

“The state of the agricultural industry is fairly positive. We see, on average, growth of around one and a half, nearly two per cent per annum over the last decade so there is growth. It has the potential to do better but it’s not achieving that potential,” he said. 

“We expect a greater allocation to agriculture, especially for support to smallholders, but for the sector as a whole. For agriculture to grow, government will have to invest more.”

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