Agri Limpopo is opgewonde oor die nuwe aanslag wat President Cyril Ramaphosa op die strukturele ekonomiese probleme soos armoede, werkloosheid en ‘n lae investeringsaptyt in Suid Afrika het, en is daartoe verbind om met sy strewe tot ekonomiese groei saam te werk.

Dit lyk en klink allerweë of hy bereid is om die sweep te klap teen korrupsie, nepotisme en wanadministrasie, wat Limpopo oor die afgelope dekade gekniehalter het.

Vanwee die praktyk van kaderoptplooiïng lê die wortels van hierdie probleme diep in die samestelling van bykans elke departement, en dit sal meer as net die regte uitsprake kos om daarvan ontslae te raak.

Dit is steeds ‘n raaisel hoe die ANC hoop om investering, werkskepping, ekonomiese groei en verhoogde produksie in die landbousektor te stimuleer met ‘n beleid van onteiening sonder vergoeding! Kapitaal is so skugter soos ‘n koedoe, en as dit skrik, hardloop dit weg. Hierdie beleid van die ANC skep juis die onsekerheid wat investering en groei inhibeer.

Hoewel dit deur ‘n resolusie en meerderheidstem die amptelike beleid van die ANC geword het, is die Nasionale Ontwikkelingsplan op dieselfde wyse in 2012 in Mangaung eenparig as ANC beleid aanvaar. Hierdie plan is nie met onteiening sonder vergoeding versoenbaar nie, en die grondhervormingsplan in Hoofstuk 6 daarvan is sedert 2012 nooit met implementeringsprogramme of ‘n begroting ondersteun nie.

President Ramaphosa was destyds die voorsitter van die Nasionale Beplanningskommissie wat die plan geformuleer het, en is bewus van talle pogings wat deur privaatsektorbelanghebbendes soos Agri Limpopo, landboubesighede, Landbank, ander banke en buitelandse investeerders geloods is om die Hoofstuk 6-plan te laat werk.

Die vennootskapgebasseerde grondhervormingsmodel van die NOP is steeds die enigste plan wat wye steun onder politieke partye en die privaatsektor geniet, en tot dusver met ‘n 100% suksessyfer geïmplementeer is. Dit maak onteiening sonder vergoeding oorbodig en sinneloos.

Agri Limpopo doen weereens ‘n beroep op President Ramaphosa om landbouleiers oor ‘n wye spektrum te betrek by gesprekke oor die beste manier om die landbousektor te ontwikkel in SA.

Navrae:
Dr Theo de Jager – Agri Limpopo Landbou-ontwikkelingskomitee 082 332 2110
Willem van Jaarsveld HUB agri Limpopo 082 451 7913

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The tabling of the annual national budget speech has proven to be one of the most anticipated events in South Africa. Along with the positive changes that are currently taking place in the political landscape, the February 2018 budget speech is set to attract not only the attention of business and individuals inside the borders of South Africa but also those outside the country.

Rating agencies will be watching the event like hawks. According to Dan Kriek, President of Agri SA, South Africa faces the risk of further credit downgrades if the budget speech is not palatable to the ratings agencies. Accordingly, the budget will have to reassure ratings agencies that South Africa is committed to maintaining the credibility of the fiscal framework and the expenditure ceiling.

According to the medium-term budget policy statement delivered in October last year, South Africa will have tax revenue shortfalls of around R50.8 billion for 2017 and R69.3 billion for 2018. By 2020/21, approximately 15% of the government’s revenue will go towards paying off debt. The country’s deficit is projected to be 61% of the gross domestic product (GDP) by 2022.

The funding of free tertiary education[2] and struggling state-owned enterprises (SOEs) are key considerations for the upcoming budget. South African Airways (SAA) and Eskom are examples of SOEs that place a significant burden on the fiscus. It is estimated that SAA will need funding of approximately R8 billion by March 2018 and Eskom around R20 billion by May/June 2018.

The budget will have to give a clear indication of the specific steps and strategies that will be used to ensure that the growing budget deficit is reined in. Subdued economic growth, limits the potential for significant tax increases without further curtailing economic growth. The World Bank projects that South African GDP growth will reach 1.1 percent in 2018 and 1.7 in 2019/20.

However, taxes are expected to rise by at least R30 billion. Agri SA hopes that expenditure cuts, particularly of wasteful expenditures, and efficiency measures will form a significant component of the specific steps and strategies to be outlined in the budget speech. Any tax increases should consider the existing burden on an already constrained tax base.

Whilst improving access to tertiary education is a noteworthy goal, improving the effectiveness of existing spending on education, for example, to improve the quality of primary and secondary education should also be considered. Steps to improve the effectiveness and efficiency of SOEs is crucial. Wasteful expenditure should be eliminated and excessive compensation to the senior management of struggling SOEs must be re-evaluated.

Unfortunately, agriculture received relatively little attention in the medium term budget policy statement (MTBPS) of October last year. Agriculture was the best performer across the first three quarters of 2017 and was the largest contributor to our 2% GDP growth in the third quarter. The MTBPS made no mention of agriculture’s contribution to economic growth nor the plight of farmers affected by ongoing droughts. Worryingly, the contingency reserve was pared down to a meagre R16 billion over the next three years. It was unclear how this will have an impact on emergency assistance for crises such as the persistent drought.

The drought situation in the Eastern, Northern, and particularly in the Western Cape remains the major risk to food production, its effect on the economy is begging to show itself and something needs to be done urgently.

Agri SA hopes that agriculture will receive greater attention in the 2018 budget. Agri SA recommends that the budget make adequate resources available to ease the impact of the drought on farmers and to provide the necessary infrastructure to help boost agriculture’s competitiveness and subsequently improve food production and job opportunities in the sector.

2 For students from households with a combined annual income of R350 000.

Issued by Agri SA, Directorate:  Corporate Liaison

Enquiries:

Dr Requier Wait, Head: Economics & Trade, Agri SA, 012-643 3400 or 073 304 0932

Mr Hamlet Hlomendlini, Chief Economist, Agri SA, 012-643 3400 or 082 957 9064

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