South Africa: How the South African Government can increase its credibility in the agricultural sector
Governments can build credibility over time by consistently advocating the efficient and effective implementation of policies. South Africa did not do well in this regard. As a result of the poor record of policy implementation, investors and the general public have become skeptical of the government’s political statements.
Recent examples of this credibility gap are the handling of two major policy initiatives. The first is the National Development Plan, launched in 2012. The second is the National Treasury’s 2019 economic policy paper entitled “Economic Transformation, Inclusive Growth and Competitiveness: Towards an Economic Strategy for South Africa”. Both were never fully implemented.
After the reveal, it was up to the ministries to draw ideas from them in order to improve their strategies. But that wasn’t done.
The factors behind poor policy implementation are many and complex. They range from contradicting ideologies, a lack of capacities within the state and its institutions, corruption and poor governance in the municipalities.
But the government seems to be realizing that the key to success lies in the implementation of public policies. Take the Economic Reconstruction and Reconstruction Plan launched in October 2020. The plan focuses on energy security, infrastructure development, green economy, food security and the tourism sector, among others.
In contrast to the slow policy implementation over the past decade, the government has implemented reforms in the energy sector. It should be emphasized that this is a sector that has already been hit by a crisis.
Elsewhere, the ministries for agriculture, land reform and rural development, and trade, industry and competition have presented sectoral master plans. This includes building up local industrial capacities for both the domestic and export markets.
These are produced with input from a number of key stakeholders in each sector. This is a break with the past, where the government worked out plans and ended up soliciting stakeholder input.
The master plan for agriculture and agribusiness has, for example, involved governments, farmers’ organizations, agribusinesses, raw materials organizations and employee representatives. This process, too, could suffer from sluggishness if it relied only on big ideas that don’t get implemented.
The Ministry of Agriculture and various social partners are about to finalize the master plan for the sector. The document supports the plans for economic recovery drawn up by President Cyril Ramaphosa a year ago. What sets this particular plan apart, however, is its commitment to the implementation and costing of its activities.
Based on many years of working with the government on the agricultural sector policy needed to make doing business in South Africa easier, I have identified a few things the government can do to improve its political credibility in this sector. I have also made a list of what the private sector contribution can be.
What can the government do?
The government’s first sensible step would be to implement all regulatory interventions that require less capital. In the case of agriculture, these would be:
the release of land already in the government’s book to beneficiaries with tradable land rights
Increased efficiency in various regulations in the livestock industry and animal hygiene, which would boost exports,
Efficiency gains in registering new agrochemicals that can help make agriculture more efficient.
It should also re-prioritize the national budget in line with the interventions of the master plan. This will signal his commitment to success.
Another important intervention would be to support state institutions such as Transnet in improving the efficiency of the ports. This should go hand in hand with increased efforts to open up further export markets for South African agriculture. Then there is the Land and Agricultural Development Bank. The government should accelerate the resolution of the bank’s financial challenges. Solving these problems would allow the bank to play an influential role in the implementation of the agricultural master plan.
The government should release land it owns to new beneficiaries with long-term tradable land rights or title deeds.
It also needs to root out corruption at various levels within the department to ensure the effectiveness and efficiency of employees.
Finally, the government needs to take action to cut red tape and red tape and bring the legislation up to date.
For example, the 1947 Fertilizers, Forage, Seeds and Medicinal Products Act, which regulates the registration, importation and sale of fertilizers, agricultural feeds, seeds and certain medicinal products, dates from 1947. Of course, it does not reflect the reality of the 21st century . Agrochemical suppliers and seed companies are struggling to bring new technologies into the country because they are not covered by law. But technologies are the key to increasing agricultural productivity.
Then there is the Agricultural Product Standards Act, which defines, classifies, and classifies most agricultural products. The problem is not in the law itself, but in how the government implemented it through a series of regulations for each product. These are troublesome and require testing, which increases the production cost.
The Ministry of Agriculture has delegated the implementation of the law to various bodies whose services must be paid for by the private sector. This increases operating costs even more, which in turn is covered by higher retail prices or lower profits for producers.
What should the private sector do?
The private sector also plays a role. The first step should be to build trust between various farmers’ organizations and the agribusiness in order to have a unanimous voice from the private sector to speak to the government.
The private sector players must also recognize the need for joint efforts in the reconstruction of South Africa and in the development of agriculture and the agro-industrial sector. An example of this is that in the development programs of various raw material organizations they could build partnerships with newly arrived farmers.
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The private sector must also participate in initiatives to finance the new farmers.
Finally, partnership programs that have proven successful in various raw materials and parts of the country need to be presented and expanded.
Dealing with the legacy of apartheid
The history of South Africa is unfortunately still partly reflected in the farmers’ associations and product groups. There are some who represent mostly black farmers and some who are mostly white farmers. This division helps to ensure that different messages are delivered to the government. Ideally, farmers’ organizations and groups should strive for a unanimous vote, at least on general issues. But the most important thing is to build trust so that each participant can feel comfortable knowing that their views are represented.
Both lists are not exhaustive, but the interventions proposed could move the needle in terms of translating the ideas on paper in various plans into concrete projects that could help grow and create jobs in South African agriculture. The government’s priority should be on building credibility. This could be achieved by listening to business and social partners and implementing the less financially costly programs quickly and effectively. This will demonstrate commitment and prove to be an encouragement to all role-players.
Wandile Sihlobo, visiting scholar, Wits School of Governance, University of the Witwatersrand