Congress
Relevant
Desember 2013
8
Agri SA congress looks at the
realities affecting agriculture
RUTH SCHULTZ, SA GRAAN/GRAIN CONTRIBUTOR
On the first day of Agri SA’s congress, that took place on 10 and 11 October
2013 in Pretoria, guest speakers highlighted the economic and political
realities that will impact agriculture’s future, while the need to cooperate
with the National Population Registration campaign was emphasised.
Economic realities
Despite improvements in social services and household assets, the
income poverty of a large proportion of South Africans has either
stayed the same or worsened over the past 20 years. “In 1997/1998 the
world was hit by a financial crisis. This period was the worst economic
performance since the great depression. In most countries, including
South Africa, output is still below potential and the employment rates are
still significantly below the pre-crises level,” Mr Kuben Naidoo, advisor
to governor Gill Marcus of the South African Reserve Bank, explained.
He highlighted some of the longer term structural issues that will affect
agriculture. “The demand for food is still increasing. While food prices
fell from the early 1990’s to the early 2000’s, it has gone up in the last
ten years. It is set to continue to rise as countries become richer and
Africa increases its income, which leads to a demand for more food and
quality food.”
Partly in a response to the crisis, an increase in protectionism has been
noticed. “While protectionism is sometimes an acceptable response
to dumping, South Africa must look at both defensive and offensive
strategies of dealing with this situation.” Naidoo says that South Africa
currently needs a more offensive approach; to find ways to increase
our agricultural exports to the rest of the world. “For example, we can
provide chickens to sub-Sahara Africa, because of our ideal location.”
Supply chain pressures on the farming sector have been significant
in South Africa and worldwide. “Producers’ margins have fallen, even
though food prices have increased, because retailers and distribution
logistics companies have been able to capture a larger share of the
supply chain.”
According to Naidoo a fair distribution of the ranks within the agricultural
value chain is needed in order for farming to be a profitable and
sustainable business, but also to use that to bring small scale farmers
into the supply chain. “The opportunity needs to be turned into a win-
win situation that benefits not only existing producers, but also new and
emerging farmers. It is thus up to producers to form co-ops and organise
themselves to reverse the price pressures on them,” he said.
Political realities
Mr Steven Friedman (director: Centre for the Study of Democracy,
University of Johannesburg) says that one of the reasons why South
Africa had such difficulties in the labour relations arena in the past
18 months is because of unsecured lending. “The most brutal part of the
unsecured lending story is that there are many South Africans who are
borrowing more money than they can repay and this is one of the reasons
why we have so much tension in the workplace,” he said.
The two reasons for unsecured lending are inequality and poverty. “The
message has gone out in society that the South African worthy of respect
is the person who owns a certain level of consumer goods. One of the
most interesting findings in the 2011 Census is that more South African
households own TV sets than fridges. This tells a very important story
about the kind of values people are being encouraged to embrace.”
He also gave an example of why people are borrowing more than what
they can afford on the poverty side. “It is estimated that the average
wage of a mine worker feeds at least eight people. People are thus also
earning money to feed dependants and relatives who cannot find jobs
themselves.”
Friedman says that we are currently in a more competitive environment
which has certain effects: “Government is going to become more
concerned about making sure that it runs better and there will also be
more pressure on government to demonstrate that it is actually dealing
with issues such as poverty and inequality.”
Cooperation needed
“It’s a strange, but true fact that half the children in the world are
unregistered. It is also strange, but true, that two thirds of deaths each
year in the world go unregistered.”
This is according to Ms Naledi Pandor (minister: Home Affairs) that says
the reason for these unregistered births and deaths is that there are many
barriers (lack of laws or infrastructure) to registering births and deaths.
The only way to know who lives and died is through civil registration.
“Without civil registration we in government won’t be able to design
adequate public services. If we don’t know how many children are born,
we won’t be able to plan for schools in future.”
Steven Friedman (director: Centre for the
Study of Democracy, University of Johan-
nesburg) and Kuben Naidoo (advisor to
governor Gill Marcus of the South African
Reserve Bank).
