Political Economy of Agriculture in SA. Trends and perceptions

Transcription

1 Political Economy of Agriculture in SA Trends and perceptions

2 In 1978, he said... We are all Africans, whatever our colour or creed or persuasion, and our future depends on our mutual loyalty and support. We are so interdependent that a lack of trust in one part of our subcontinent affects everybody in other parts.

3 If we want investments from elsewhere, we have to push each other up the economic ladder. If we pull down those ahead of us, we shall all fall together.

4 In 1976, The World newspaper, Sowetan s predecessor which was later banned by the apartheid government, said of him... What Dr [Johan]Rupert has done in effect is to waken this country s social conscience. He is saying to his fellow industrialists that nothing is gained by accusing the government of making a mess of things. One must do something about it.

5 Progress... The talks about talks between the ANC and Afrikaner intellectuals and business Liberation organisations unbanned Negotiations at Codesa: compromise deal Constitution interim and final adopted

6 Multilayered Tensions... Property Clause vs Land Reform Commercial vs Political Imperative Divisive Past vs Inclusive Future Growing Cake vs Leftovers Uncertainty vs Certainty Rigidity vs Flexibility Global Ambition vs Backyard Bickering

7 The consequences... Mediocre growth of agriculture: Av 1, 6% Farm units decline: 35% (2007) Jobs drop from to (2013) Value of Agri imports exceeded exports for the first time in 50 years (2012) Farm debt rise from R18.18bn to R88.78 bn Old hard-line habits die hard

8 Consequences continued... Very low wages Bad image for sector Post-94 farm murders Bad image for sector Government misses target: 30 % of land to be redistributed to blacks Legislation to blame Weak post-settlement support Bad policies Demagoguery (Mugabe type) rhetoric Govt mistakes/failure hardens attitudes

9 The current context... Traditional big employers in decline relative to job demand. (Mining, agriculture, industrial) Unemployment 25%, same level as Greece (expanded definition: 35%) Youth unemployment is 50% - very dangerous Inequality of wealth and income rise Government debt rise

10 Current context Competition for global market share rough Agriculture linked to the global economy since early 19 th Century (for example, price of wool) Both size and quality matters SA retailers: logistical infrastructure subjecting local farmer to global competition Market share expansion needs domestic coherence and consensus

11 Turbulence in race to solve crisis... Policy contradictions: expropriation, quotas Domestic and global markets edgy (Example: CEO of a multinational manufacturing firm) National minimum wage talks Black Economic Empowerment now urgent Delays fuel uncertainty

12 Turbulence in race to solve crisis... Polarised political debates: Gap between FF+ and EFF except between the Fs is too extreme Finance Minister Nhlanhla Nene flags pending land reform policy among key policy issues causing uncertainty ANC s Gwede Mantashe: Land reform should be linked with food production ; Policy clarity and certainty is necessary.

13 Recommendations Way forward...we always knew the solution... What Dr [Johan]Rupert has done in effect is to waken this country s social conscience. He is saying to his fellow industrialists that nothing is gained by accusing the government of making a mess of things. One must do something about it.

14 What is to be done? Stakeholder capitalism give workers a stake. Engage constructively break bread Implement land tenure policies farm evictions give the sector a bad name If you want politicians to lead the process stand back and relax...they will do it for you!