Apart from a thorough understanding of agricultural techniques, these skills more often than not also require an intimate knowledge of tasks related to engineering, economics, human resource management, cost accounting, logistics management and marketing.
Most farmers are also exposed to substantially more risks than those encountered in other industries. First and foremost is the unpredictability of the climate, which has been exacerbated by global warming and the depletion of the earth’s ozone layer. This has become manifested in erratic and shifting weather patterns.
A recent report by the Intergovernmental Panel on Climate Change (IPCC) predicts a significant decline in global crop yields every decade into the future, with literally millions of hectares of cultivated land being phased out annually. The effects of climate change are frightening and include drought, excessively high temperatures, flooding, seasons that shift and partially overlap, insect infestations and superstorms.
The threat of invasive species has become elevated due to the relentless increase in world trade, which has allowed some insect species to spread around the globe and wreak havoc upon some of the domestic species – bees represent a recent example. According to a report published in the Proceedings of the National Academy of Sciences of the USA, the crop and forestry production losses caused by invasive species and diseases is estimated at $40-billion annually.
Regenerative farming is vital to ensure food security
In many developing countries that are confronted with widespread poverty, agricultural development is also threated by high levels of crime, ranging from stock and crop theft to arson and violent assault. On top of these daunting operational conditions, developing countries are also faced with a lack of supportive policies to counter the high levels of farm subsidies in most of the post-industrial countries, especially the Common Agricultural Policy (CAP) of the European Union.
The Agri SA study involved a macroeconomic impact assessment of a policy of land expropriation without compensation via econometric modelling, based on changes to capital formation/GDP ratios gleaned from relevant country case studies where policies of land expropriation without compensation were implemented.
The study avoided the disjointed and often ideological debate on widely differing opinions of what is perceived as wrong or right with property ownership in the country, but simply points out the results of a quantitative assessment of the likely future effects on the South African economy if EWC was to be pursued. In summary, the following conclusions were arrived at:
- A decline in annualised nominal GDP in Q3 2022 of R417-billion (in the event of a 5% decline in capital formation and a decline of R616-billion in the case of a 10% decline in capital formation
- The cumulative loss of economic output over the nine quarters of the forecasting exercise amounts to R735 billion and R1.05 trillion for these two scenarios, respectively
- Government’s much anticipated Reconstruction and Recovery Plan will come to naught and within a couple of years, fiscal revenues will dwindle to the point that the grant system for 18 million people may have to be abolished. This will have profoundly negative implications in terms of food security, widespread poverty, malnutrition, unemployment and social unrest.
In conclusion, the study confirms imminent socio-economic disaster for South Africa in the event of EWC being pursued. It stated that politicians and bureaucrats cannot repeal the fundamental laws of economics, try as they might. Economic capital, which is an indispensable prerequisite for economic development, job creation and growth, needs to be nurtured and incentivised, otherwise it simply moves to greener pastures.
