Agri SA Newsletter: February

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February 27, 2017

Agri SA Newsletter: February

Agri SA’s response to the 2017 budget speech of the Minister of Finance

“Despite very difficult circumstances, Minister Pravin Gordhan delivered a budget that was indicative of his realisation that the current economic trajectory is unsustainable and that a new approach is required”, says Johannes Möller, president of Agri SA.

“The Minister emphasized the need for the economy to grow above the projected growth rate of 1.3% as this falls well short of our NDP goals and is not sufficient to reduce unemployment or impact significantly on poverty and inequality. As was indicated by the Minister a joint effort by all stakeholders will be required to achieve this goal”, Möller said.

However, according to Möller that not enough was said with respect to curbing the high levels of corruption nor was the drain on the fiscus brought about by the state-owned companies addressed firmly enough. Taxing people in high income brackets might have been the right and soft option for now but it will not suffice as a medium-term option, given structural problems clearly present on both the income and expenditure side of government finances.

“From an agricultural perspective – the R30 billion spending on agriculture, rural development and land reform over the medium term is appreciated provided it will serve the purpose of what it is intended for. The focus of this spending should be on commercial agriculture i.e. moving land reform beneficiaries towards commercial production and increasing productivity of existing commercial agriculture. It is also critical that we find innovative technics to attract young people in the sector. Land reform must prioritise willing and capable (i.e. know-how) young farmers – most of the spending in Agriculture must be directed towards this purpose. This is very important for the sustainability of the sector”, said Möller.

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