South Africa is a country of many challenges and is also a gateway for investors in Africa and offers enough opportunities in agriculture for investment, cooperation, expansion and trade. New foreign agricultural investments in South Africa are to the advantage of South African farmers and assist in job-creation.
This was the central theme of a speech which Dr. Pieter Mulder, deputy minister of agriculture, forestry and fisheries delivered this morning at an international agricultural conference in Pilanesberg. The conference was attended by the largest and most successful farmers from, amongst others, America, Russia and Portugal.
Dr. Mulder said South Africa is still the economic giant of Africa and if the current trend continues, Africa will play an increasingly important role in the world economy.
“By the year 2040, one in every five of the planet’s young people will be living in Africa and its working population will be larger than that of China.
What is of great importance for farmers is that Africa has approximately 60% of the world’s uncultivated agricultural land and a large portion of its natural resources. Yet it only delivers 10% of the world’s food, while its consumers are increasing at three times the rate of the OECD (Organisation for Economic Co-operation and Development) countries and food production will have to increase accordingly,” Dr. Mulder said.
According to him, the biggest reason for Africa’s low food production is a shortage of large commercial farms. In Africa 85% of all farms are smaller than 2 hectares. In America, for example, only 4% of farms are smaller than 2 hectares. New models should therefore be developed to make production work according to these models without causing any harm to commercial farmers. If the planned Tripartite Free Trade Aria (FTA) in Africa becomes a reality, it would create a market of 600 million people in 26 countries stretching from Cape Town along the east coast to Cairo.
According to Statistics South Africa, there are 47 500 commercial farmers who play a key role in food security in the country. The latest figures is closer to 36 000. They produce 95% of South Africa’s food while the remaining 5% is produced by emerging and subsistence farmers.
The world trend is urbanisation and more than 60% of the world’s population live in cities and that is why the role of subsistence farmers in food security is becoming smaller. It is clear that the world will increasingly rely on industrial farmers to keep the global food basket full.
In the period 2012/2013 South Africa’s export of agricultural products increased by 16,4% but its imports had also increased by 12,3% over the same period.
“It is important for the government to create new agricultural opportunities in South Africa and for this close cooperation between farmers and business sectors, the government and foreign investors are needed. It is also important that the government creates the right climate that would make South Africa an attractive option for foreign investors,” Dr. Mulder said.
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