POPULIST LURCH THREATENS SA’S FARMS
Not that we need any more signs that the governing ANC has zero compunction in betting the country’s future on its short-term populist interests, but water & sanitation minister Senzo Mchunu’s proposed new water licensing rules are a reminder of what’s at stake.
Mchunu’s draft rules will require successful licensees to have 25%-75% black South African shareholding a requirement that Agri SA legal and policy executive Janse Rabie says will have a “devastating effect” on the commercial agricultural sector.
Rabie says this rule effectively puts the country’s food supply chain at risk, since most commercial farmers won’t meet the criteria which, rather than incorporating wider empowerment factors such as community empowerment and the extent to which enterprises promote black suppliers, focus solely on black ownership.
“You can’t look at the need to redress past discrimination practices in isolation,” says Rabie. “This is why these draft regulations are so dissonant: they haven’t taken into account the other plans and efforts and processes that have been taking place over 30 years and are now on the table with respect to achieving transformation in society.”
The lack of pragmatism in Mchunu’s proposals not to mention their blithe disregard for the structure of the commercial agricultural sector is breathtakingly reckless, given how fragile the economy is right now.
These rules will cut into the heart of the sector, which uses 60% of the country’s available water resources to grow our food.
As it stands, agriculture is under immense pressure from soaring interest rates and relentless load-shedding. This was painfully clear in GDP figures for the first quarter, in which its contribution crumbled, falling 12.3%. Agriculture was in fact the largest negative contributor, shaving 0.4% from GDP growth in those three months.
Rabie argues that Agri SA isn’t “blind or insensitive to transformation”, but steps to advance it need to be taken “patiently and through rational, evidence-based decisions — not simply through an overnight change as these regulations seem to want to do”.
It’s a rule change that smacks of populist inclinations, a last-mile, knee-jerk response designed to remedy the fact that the state has had almost 30 years to implement a rational, consistent land reform programme to effect redress and undo apartheid’s legacy, yet has singularly failed to do this.
Instead, land reform has failed because the ANC-led government has, as Kgalema Motlanthe’s high-level panel in 2017 pointed out, lacked political will while its implementation of existing laws was “dysfunctional”.
The proposals also ignore the global trend towards mega commercial farming enterprises. As Agri SA argues, countries with agrarian and subsistence economies are typically poor — “there’s a poverty trap element to being stuck in small-scale farming”.
Commercial agriculture, on the other hand, “is an economic stabiliser … it creates employment and social stability. It’ sa … job and wealth creator — and those commercial [farmers] that play a role in ensuring food security are few and becoming fewer.”
Rabie says these rules would make it all the more difficult for farmers to play their role in the food supply chain. “Almost every 15 years farmers halve in number, but agricultural output doesn’t necessarily decline — it’s just in the hands of bigger conglomerates. It’s a reality and it’s not going to change.”
Except, it may do so now thanks to Mchunu’s heavy hand just not for the better.