The plan has been hailed as the commitment of value chain actors in agriculture and food sectors to build a competitive, transformed, and growing agricultural economy that also creates sustainable jobs and ensures food security in the country.
The AAMP is effectively an operational framework that seeks to fast-track the implementation of the National Development Plan goals, which were also affirmed in the Economic Reconstruction and Recovery Plan. The value chain players, together with the government, agreed that the AAMP interventions must be implemented in a private-public approach capitalising on skills, resources, and knowledge available at industries and state, including labour and civil society.
At the time of the Master Plan signing, there was an overwhelming consensus among actors on priority measures relating to enhancing the competitiveness of the sector, expanding export opportunities, and maintaining key infrastructure. But there was limited harmony in interventions required to advance transformation, decent work conditions, and the enforcement or monitoring mechanism of labour laws in the sector.
Despite these challenges, all value chain players agreed that implementation of AAMP measures would be guided by the two implementation structures, namely value chain round tables and production schemes.
Moreover, a special-purpose vehicle was needed to address the outstanding matters of labour and the monitoring of labour law’s enforcement.
Not progressing as planned
Today, there are growing concerns about the slow implementation pace of the AAMP.
Agri SA welcomes signing of the Agriculture and Agro Processing Masterplan
While these concerns are warranted, the dynamic and complex agricultural environment affects the planning and resource allocation, which somewhat contributes to the slow implementation.
For example, since the signing of the AAMP, the sector has had to deal with the global food price rise and disruptions on food supply caused by the conflict between Russia and Ukraine.
Also, the challenge of load shedding has impacted the farming operation creating a need for a short-term solution. As a result, the state created a R2.5 billion Agriculture Energy Fund to incentivise farmers to invest in alternative energy sources.
At present, sectoral indicators suggest the sector is stabilising. Food inflation has decelerated to 12% dropping from 14.3%, and the Crop Estimate Committee estimates a positive agricultural outlook.
These positive signs have encouraged value chain actors to shift the attention back to the major interventions included in the AAMP that will boost inclusive growth and competitiveness.
Top of the agenda is increasing farmers’ access to finance through the Blended Finance Scheme. The Department of Agriculture, Land Reform and Rural Development (DALRRD) has partnered with the Land Bank and Industrial Development Corporation to create blended finance, unlocking about R4 billion. Industry representatives are encouraging government to expand this scheme to include commercial banks and agribusiness. It will be important that each bank directly engages with the department to expand the scheme partners.
Equally, as committed in the AAMP, banks and agribusiness must avail their Enterprise Supplier Development funds to augment funding for farmers.
The second priority area is addressing constraints in the animal industry, which include animal health, availability of vaccines and improved coordination of veterinary services. This also requires clear and public-private-coordinated actions to mainstream the animals owned by black farmers into a formal red meat value chain.
The AAMP recommended the production scheme as a suitable platform to bring private sector participation and investments, building up on programmes such as the National Red Meat Programme. The Karan Beef-Triple A Meet merger offers a low hanging fruit, where animals from commercial and non-commercial farmers can be integrated into formal markets while ensuring rural animal holding facilities play a role in quarantining and improving the health of animal herd.
Growing the animal industry inclusively will have a positive spillover effect on grains and oilseed industries across the country. This implies the need to build storage and crushing facilities on coastal areas linking up with programmes such as the Farmer Producer Support Units (FPSUs), which is driven by provinces. This will unlock the grains and oilseeds production potential identified in rural areas, subsequently limiting the movement of animals from the coast to central parts of the country.
It is important to note that this links to the third priority area of bringing idle or underutilised tribal and land reform farms into production. It is estimated that up to 481 380 hectares could be brought into production; however, they require an annual investment of R4.5 billion. Already in 2021/22 season, government, in partnership with the Solidarity Fund, House of Traditional Leaders, and Provinces via the Presidential Employment Stimulus Initiative (PESI) restored more than 350 000 hectares of land.
The fourth priority is maintaining and expanding access to export markets for high-value commodities such as fruit, wine, wool, nuts, sugar, and others. To augment this, value chain actors would need to secure funds to repair and upscale irrigation schemes in the country. Importantly, new or existing export opportunities must also integrate produce from black farmers to achieve an inclusive growth. There are also areas that speak to skills development, regulations and access to land and water.
One other crucial area for the success of the AAMP is to resolve outstanding matters of labour. It is crucial that value chain actors find an independent and informed person or institution to facilitate the discussion between labour and industry. The outcomes of this labour discussion must be integrated into the activities of value chain round tables and production schemes across all commodities.
Therefore, the first step to achieve all these requires the value chain actors led by the government to host an AAMP Executive Oversight Committee session within the month of July, chaired by the Minister of DALRRD. The outcome of such a session should outline the top five priority areas for implementation in 2023.
Sifiso Ntombela (PhD) an agricultural economist
