Agriculture is one of the sectors that will help create employment and economic activity in rural South Africa.
I have argued in the previous blog entries that the South African government should instead recast its vision of agricultural development using Chapter Six of the National Development Plan as a point of departure. This specifically applies to the former homeland regions and underutilised land reform farms, as these are the areas that still carry the potential for agricultural expansions.
As I have previously mentioned elsewhere, this developmental ambition will require that South Africa confront various infrastructure and governance constraints that have hindered development and growth of agriculture over the past two decades. These include; (1) Market failures (high transaction costs, remote location); (2) Government failures (inefficiencies, poor service delivery and corruption); (3) Community failures (poor local institutions, vested interests of traditional leaders); and (5) Poor land governance (lack of secure tenure). This also includes trivial politics and divisions amongst various stakeholders that contribute to slow progress in this sector .
Chapter Six of the of the National Development Plan highlights that the labour-intensive and high-value products such as horticulture should be the critical priority (this message is still very relevant even today, eight years since its publication). But of course, in areas where horticulture can’t thrive, field crops and livestock and other activities should be explored.
The additional insights that today’s blogpost brings comes from a paper written in 2019 by the Western Cape Department of Agriculture agricultural economists — Louw Pienaar; Mzwanele Lingani and Philip Swart. Their paper zoomed into the horticulture industry and highlighted the fruitfulness of high (value) growth and labour-intensive horticultural crops. This ties in with the broader agricultural development message I have been writing about elsewhere (and, briefly, in the first three paragraphs of this post).
From an employment perspective, each hectare of blueberries planted results in the direct employment of 2.64 fulltime equivalent workers, on average. This is the highest employment intensity amongst the major fruits grown in South Africa. Other industries with high employment potential were table grapes (2.2), flowers (2.1) and cherries (1.9), whilst pome (apples & pears) and stone fruit (apricots, plums, prunes, peaches & nectarines) created 1.1 jobs per hectare planted. At the lower end of the spectrum, crops such as nuts, sub-tropical fruit and citrus have employment multipliers of around 0.5.
In terms of economic growth, the blueberry industry has significantly outperformed other fruit industries by growing its gross value of production from an estimated value of R15.8 million in 2008 to R1.25 billion in 2018. Other good performers over the same period were table grapes and nuts, expanding in value by 24% and 21% respectively per annum. Pome and stone fruit had moderate growth over this period with 6% per annum, whilst the wine grape industry came under severe pressure lately with annual growth of 0.8%.
See all the illustrated figures on the link above.
