Agbiz CEO Dr John Purchase on Tuesday shared the agricultural sector’s five-year business plan at the Business Unity South Africa Business Economic Indaba, held in Midrand.
The plan for this sector prioritised the recovery of jobs lost as a result of the drought in the country and to continue expanding into global and local markets.
At the event, panel facilitator Professor Nick Binedell said 22 sectors have been at work on their own plans since President Cyril Ramaphosa’s State of the Nation Address in 2018, during which he invited various economic sectors to create plans for inclusive growth through public–private growth initiatives.
Purchase said the agricultural sector needs to attract investment to get job creation going, as well as private partnerships, and enabling legislation to facilitate agriculture investment.
“Supply chain management by private companies is a key area that needs development, to reindustrialise the sector and stimulate production, while more agroprocessing incentives are needed.
“Primary agriculture contributes about 2.5% to gross domestic product (GDP), but total contribution from the value chain, including agroprocessing and trade, is 14% of GDP.
Thirty-three per cent of revenue that is earned by the primary agriculture sector is from exports.
Purchase said trade banners have been positive and growing since 2006, with exports last year exceeding $10-billion.
However, he added that primary agriculture is only growing at 6% a year, which is too low.
Major trends in the sector at the moment is farming profitability and global competitiveness, which is under pressure owing to various factors, such as loss of land from urbanisation and mining, reduced government investment in research and development, the outbreak of diseases and changes in logistics to mitigate problems with ageing road and rail infrastructure.
“In our plan, we look at the adoption of conservation agriculture and sustainable agricultural initiatives, while focusing on developing new technologies and improving institutional structure and capacity.
“We have a common vision with government around food safety and food security, while increasing global competitiveness and using available resources efficiently,” said Purchase.
Moreover, the agricultural sector plan looks at training and skills development and developing feasible financing solutions, such as blended models, as well as disaster management improvements, since climate change is already affecting weather patterns in South Africa.
Purchase mentioned that government needed to provide certainty around maintenance and the extension of property rights amid land reform discussions.
Illegal imports also need to be better addressed, he added.