May 06, 2008, 15:30
South Africa's sluggish land reforms are paralysing nearly half of its sugar and timber sectors and new black farmers are the hardest hit, a report released today said. "South Africa's reputation as a competitive agricultural producer is on the line," said a study by the Centre for Development and Enterprise (CDE), a policy think tank.
"The economic viability of many rural regions of the country is under threat, which could lead to serious negative consequences for the broader economy and society," said CDE executive director Ann Bernstein.
"All this is happening in the midst of a global rise in food and commodity prices. South Africa is not only losing out on important new opportunities but starting to undermine its competitiveness and capacity in the agricultural sector," she added.
The last phase of land restitution, which dealt with rural claims, has seen large swathes of productive land placed under claim and "therefore effectively frozen for years to come", the report said.
It quoted statistics from the SA Cane Growers Association which showed that 50% of all sugar land was under claim with only 4% settled, nearly half of timber land owned by Mondi was under claim and at least 17.5% of Sappi's land was under claim.
"This means that farmers cannot borrow against their land for the next harvest or to buy machinery or make improvements; it means that aspirant new black farmers cannot get bank loans to purchase this land."
The land redistribution process was too slow to meet the government's target that 30% of commercial agricultural land be owned by blacks by 2014. Between 2004 and 2007, state redistribution of white-owned land increased by less than half a percent from 4.3%to 4.7%.
Nobody wins
The study said South Africa was looking at two likely trajectories -"nobody wins" and "everybody loses". "Neither of these is desirable and both threaten agricultural production, investor confidence, race relations and the prospects for South Africa's rural poor."
However, the good news was that the transition of land into black hands was increasing, according to the CDE's own research. "CDE estimates that the true extent of land transferred from white to black ownership is now close to 6.8% of commercial agricultural land. This means that an area equivalent to 40% of the land transferred by the state has been bought by blacks in the open market -and this is probably an underestimate," the report said.
Black land ownership is the highest in KwaDukuza in KwaZulu-Natal, where black farmers now own 32% of land, while the Eastern Cape regions of Elliot and Ugie enjoy black ownership of close to 30%. In the Free State, between 12 and 20% of land is owned by blacks in certain areas. The CDE has identified 50 projects where existing farmers support new farmers who have benefited from the settlement of land claims.
"But, this is all at risk. The extent of unresolved restitution claims in some regions of the country and the long delays in resolving these claims are leading to large swathes of agricultural land being frozen. "In addition, CDE has evidence of new black farmers who are finally starting to prosper, now devastated by the claims that are being lodged on their redistributed farms in a bizarre clash of policies operating in isolation from each other."
The CDE study reviewed the land market, the private sector's role in land reform, state programmes and policy developments. The study focused particularly on the sugar, timber and fruit industries. It recommended that the government conduct an audit of state land to ensure that land redistribution met the needs of poor people in rural areas and promoted black farm ownership. - Sapa
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