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Address By Deputy Minister Bheki Cele 2016 State Of The Nation Address

Madam Speaker, during his State of the Nation Address, the State President emphasised the importance of agriculture, forestry and fisheries as he gave feedback on the Nine Point Plan, with specific emphasis on the Revitalisation of Agriculture and Agro-Processing Value Chains and the Blue Oceans Economy.

Collectively, agriculture, forestry and fisheries' sector contributes over R70 billion to South Africa's economy. Furthermore this sector is notable as an employer, as an earner of foreign exchange and as a supplier of raw materials for the manufacturing sector. This sector has the best multiplier effect for every rand invested in terms of employment, exports, fiscal revenue and economic output [(Gross Domestic Product (GDP)].

However this sector is currently facing the worst drought ever recorded in the history of South Africa. This drought is threatening the national priorities relating to food security, job security and the economic growth. This drought is affecting will be more pronounced on small scale producers and the poor.

DROUGHT

In the SoNA the President stated that five provinces have been seriously affected by drought and government provides relief to affected communities. All provinces are under constant assessment and further declarations have been and will continue to be made as the assessments are concluded.

The national government departments, coordinated by the National Disaster Management Centre (NDMC) of the Department of Cooperative Governance, are working with the South African Weather Service (SAWS) and the Agricultural Research Council (ARC) to ensure streamlined recovery and future mitigation of drought and other natural hazards affecting the sector and that these are communicated to the farming community.

It is important to note that other mitigating and risk reduction programmes of government are continuing. A total of R498 million has been approved in addition to R124 million allocated by provinces to assist the affected farmers with livestock feeds and livestock water.

A total number of 9 227 047 of cattle, goat and sheep in all provinces have benefited up to so far. Additional funding is being requested from National Treasury through the Inter-Ministerial Committee to extend the assistance. Government has also further established feedlots areas in provinces such as KZN to alleviate the carrying capacity in stressed grazing areas. We are engaging with Industrial Development Corporation (IDC) and the Land Bank who have already made available over R100 million to assist farmers with credit facilities related to drought. Regarding maize, the latest Crop Estimates Committee (which is a body consisting of government and the private sector) revised the estimated maize imports to be at 4.1 million tons.

Logistical arrangements to ensure smooth import of this maize have been made with industry role players.

The latest showers experienced in parts of the country are welcomed because they will alleviate the current conditions to a certain extent. Government will continue to engage with sector stakeholders, including farmer organisations to explore further options to alleviate the impact of drought.

Apart from drought, the current global economic climate which is not conducive, will also impact on the national priorities relating to food security, job creation and economic growth of the sector. South Africa is part of the global economy and until we accept that we are also exposed to the vagaries of world economic turmoil then we are living in a 'fool's paradise'.

FOOD SECURITY

Hunger and food insecurity undermine development efforts and severely constrain human and economic potential. They place a strain on the economy in lost productivity, increased expenditure on health systems and social protection. This is a major drain on both the developmental and redistributive functions of transformation, leading to significant leakage of growth potential and lost opportunities.

Globally: approximately 795 million people are undernourished, down 167 million over the last decade, and 216 million less than in 1990-92. The decline is more pronounced in developing regions, despite significant population growth.

Regionally: Hunger in the region declined by 30% between the 1990- 1992 and 2015, this is in accordance with the State of Food Insecurity in the World Report (SOFI 2015). This 30% decline translates to approximately one person out of four in Sub Saharan Africa being undernourished today compared to a ratio of one person out of three in 1990- 1992.

In South Africa (nationally): about 14.1 million (26%) of people are still predisposed to hunger and malnutrition and therefore do not have enough food to eat, thereby increasing levels of absolute poverty every year. The figure steadily increased from 12.0 million in 2011, 13.6 million in 2012, and 13.8 million in 2013. The top four provinces affected by food insecurity using absolute figures are KZN with 3 481 88, the Eastern Cape with 2 237 401, Gauteng 2 052 802 and the Western Cape 1 792 838. So the glossy picture painted yesterday regarding the Western Cape is a fallacy.

The current situation calls for coordinated food security interventions. This is not by accident and not because God is angry with us but because of the systematic and orchestrated exclusion of the majority.

Unfortunately the architects of the pain and hunger are sitting here and are not accepting the responsibility to together reverse the calamity and catastrophe created by the their forbearers Nonetheless we shall not sit and be discouraged by those who are responsible for the creation of slavery, man-made starvation and hunger, we shall continue with our resolve of implementing our recovery plan and create a better life for all.

Fortunately the current government is working hard to turnaround the humiliating and depressing approach of the apartheid government. The government has centralised the establishment of a national food security implementation framework in the office of the Deputy President.

Government has also approved Agriculture Phakisa project (Operation Phakisa Agriculture and Rural Development) aimed at fast tracking targeted planning towards the achievement of the National Development Plan targets on agriculture and rural development targets.

THE REVITALISATION OF AGRICULTRE AND AGRO-PROCESSING VALUE CHAIN

On job creation, the drought is expected to impact on job creation negatively. Currently employment in the sector stands at 897,000, with a potential decrease of -10% following the drought. However the implementation of the planned government interventions will yield the following:

" With regard to infrastructure development, there are 26 Strategic Infrastructure Projects (SIP) 11 anchor projects, of which 4 have commenced with construction; 5 are at post feasibility phase and the rest are either at a concept or feasibility phase. These projects are expected to create 43,487 jobs when completed.

" On farm infrastructure, to date, 13,912 farmers, the majority being smallholder farmers, received support from the Department of Agriculture, Forestry and Fisheries and the Department of Rural Development and Land Reform. Support ranged from interventions such as stock handling facilities, piggery structures, boreholes, fencing, pack houses. These interventions led to the creation of 1,379 jobs.

" The Oceans Economy for Aquaculture is expected to create 15 000 jobs in the next five years.

" Furthermore, our commitment to redressing the historic exclusion of black fishers has been greatly bolstered with black ownership of fishing rights in the 7 fishery sectors now averaging 70.57%. The additional rights allocated will create a further 2 120 jobs in our coastal villages and towns along the Cape West Coast and Eastern Cape Coast.

On economic growth, with all things favourable Agriculture has the potential to grow its GDP contribution by 0.5%, however with the existing threat of drought this growth target was reviewed downwards to 0.3%.

Part of our turnaround regarding the Revitalisation of Agriculture and Agro Processing Value Chains focuses on four critical objectives, namely: (1) Speeding up land reform, (2) Improving market access, (3) Producer support and (4) Increasing production. The President gave a glimpse of the progress made within this important area of the Nine Point Plan and I will briefly unpack the progress made within the revitalisation of agriculture and agro processing value chains and the Blue Economy.

Speeding up land reform

The President reported about the twenty seven (27) proposals which were submitted by commercial farmers to pilot the 50/50 policy. Of the 27 proposals 4 were approved and 3 were implemented. The implemented were:

1. Birbury Farm, Eastern Cape, 2. Oatlands, Free State, 3. Diamand / Klippan, and Kalkput, in the Free State.

There are a further 9 proposals which are undergoing technical work, including due diligence, evaluation and tenure rights enquiries. Farm workers are further trained in different fields on these "50/50 farms".

MARKET ACCESS

AgriParks

The President has given a brief progress on AgriParks which form an axis of our local market access interventions. The site identification for 44 Districts as well as the stakeholder and community mobilisation has been completed. The District Agri-parks Advisory Councils (DAAC) and the National Agri-parks Advisory Council (NAAC) were launched on the 11 December 2015. The construction of Agri-parks in support of Farmer Production Support Units (FPU) and Agri-hubs are underway, with 17 projects at 26-50% of construction, and 4 projects above 50%. As the President pronounced, five AgriParks (in 5 provinces) are at different stages of completion.

The major growth in trade for South Africa has been with Africa. Increasing market access not focusing on intra-African trade will be futile exercise. Currently the global commodity forecast, shows that agricultural commodities are flat and production of many staple commodities is considered adequate to feed the current world population.

However the food produced is neither accessible nor affordable to the food insecure in Africa. Mr President, the time has come for South Africa and Africa to look for solutions internally. The time for African solutions to African challenges is here and now. Most of us sitting here have single passports and have no option but to find solutions as this is our continent. Unfortunately I cannot express the same for those with dual passports.

International Market Access

Madam Speaker, after several years of negotiations, we recently exported our first Litchi fruit to the United States of America (USA). Also, we are in the final processes of concluding agricultural trade protocols for resuming exports of Table Grapes to Thailand, and for starting to export South African Avocados to Japan. We are also gearing a number of our prioritised commodities to take advantage of the new and pending increased quotas which have been agreed to by SA negotiators with the EU such as Wine and Sugar. These quotas have been agreed upon between negotiators but await finalisation by the EU parliament.

South Africa recently participated at the WTO 10th Ministerial meeting on the Doha Development Agenda. The highlights of this outcome for agriculture include:

" Elimination of export subsidies by developing countries by 2018. " The maximum repayment period for export credits was fixed at 18 months. " A new text on food aid was developed and negotiated by South Africa with the United States, in collaboration with the Africa Group.

It is important to highlight food aid as my experience with global commodities groups is that food aid is at the bottom of the discussions.

Under the Africa Growth and Opportunity Act (AGOA) of the United States of America (USA). Trade between USA and South Africa is estimated to be around R75bn of which R25bn is couched under AGOA. South Africa has been able to trade citrus, litchis and wine under the preferential tariffs of AGOA.

As we laud our good prospects in continued participation in the second round of AGOA, we will not lose focus, but continue to intensify poultry production in South Africa to ensure that we achieve the ambitious targets we set ourselves in APAP and become a net exporter of poultry meat. This will ensure that the rural women and youth are able to participate in our poultry initiatives. Our vision is to ensure that the South African poultry sector continues to grow and successful black poultry value chain entrepreneurs like Kholofelo Maponya and Kenneth Twala continue to work with government to support the growth in our industry.

PRODUCER SUPPORT

Smallholder farming

One major intervention to fight the scourge of hunger and food insecurity is to increase the support to smallholders. The number of smallholder farmers stood at 172,000 in 2014. It is estimated that recent drought will decrease by -10%. However the prospects once the climatic conditions normalise the number is expected to increase to 16 000 by 2019. We have made a call to National Treasury to increase the allocation to support smallholders and National Treasury is amenable to consider.

We are further utilising the skills and structures at our disposal to support the training of smallholders and support their production initiatives. The following are examples of our interventions:

" The SA GAP Certification Programme (South African Good Agricultural Practice) in collaboration with the Perishable Products Export Control Board (PPECB) to assist small-holder producers of fruits and vegetables to comply to food safety requirements. To date 108 farmers have been trained.

" The "Farm Together Programme", which supported 71 existing cooperatives, establishing 13 new secondary cooperatives and 25 small agribusinesses were assessed and are under consideration.

" The research programmes of the Agricultural Research Council in pushing the agriculture research agenda.

" The Onderstepoort Biological Products for the production of animal health vaccines. " The National Agricultural Marketing Council for ensuring better market access and market penetration.

" The training of the meat 488 Meat Inspectors and Examiners which will be the youth and women to ensure global compliance of South African products leading to huge opportunities of red meat market access to South Asia.

We have entered into an agreement with Tiger Brands to allow smallholders to supply them with vegetables, sunflower and maize. Tiger Brands will contract producers and will offer guaranteed off-take agreements through its Agricultural Commodities Enterprise Supplier Development (ESD) programme. At least 70 smallholder producers from the Nwanedi Cluster in the Vhembe District of Limpopo had their contracts renewed in December 2015 to continue supplying commodities.

Mainstreaming of the youth

The department has introduced the Compulsory Community Service (CCS) for newly qualified Veterinarians. The first team of 123 have been strategically placed to service resource poor farmers in the rural and under-serviced areas of South Africa as of January 2016. The CCS is aimed at promoting primary animal health care in rural areas and will improve equitable access and participation and competitiveness of the red meat and poultry sectors. To further illustrate our commitment, to date, 104 Mobile clinics have been distributed to support this new community vets in the remote areas.

The Departments of Agriculture, Forestry and Fisheries and the Department of Rural Development and Land Reform are busy with the audit of all unemployed graduates who utilised government bursaries to acquire sector specific qualifications. This initiative is meant to start new wealth of untold scale that never existed before which is our contribution to the transformation of the farming industry. At the moment 80% of the food is produced by 20% of the farming community which happens to be predominantly white. Land restitution farms that are lying fallow will be brought back to production through a reversal process where resources will be invested to change the plight of commercial farming in South Africa.

Securing new entrants

One field of growth in the agriculture, forestry and fisheries sector is forestry especially in processing [value addition] and agroforestry. To achieve this the DAFF, Department of Water and Sanitation and the Department of Environmental Affairs are to meet to chart the way forward to plant 147 000 and revitalise 22 000 ha that will give us 9 800 jobs in primary production and 39 200 jobs in processing sector.. Furthermore 4000 ha in Mpumalanga will be recommissioned.

We will pursue all the new production methods including the acquisition bamboo farming technologies. In our quest to create sustainable businesses using forestry resources, and to address the ideals of the National Development Plan (NDP), we are supporting afforestation projects owned by small growers in KwaZulu-Natal. The Department will spend about R 5.5 million to support communities and individuals with Environmental Impact Assessments studies that will result in licenses being issued for an original area of 5000ha. This area entails about 79 sites (projects) in KwaZulu-Natal. If the whole area is licensed 100 direct and further 400 indirect jobs will be created.

Fisheries and Aquaculture

The President spent time during the SONA to deal with aquaculture as part of the Ocean Economy. A year after the launch of Operation Phakisa in October 2014, the catalyst projects have reached 94% and 68% of their lab targets in terms of annual production and job creation, respectively. This has contributed to an increase in GDP contribution of R29 million.

To fast-track the growth of the sector, there has been a combined investment of R456 million into aquaculture, of which R350 million is from the private sector and R106 million from government. This will translate into an increased contribution of R256 million to the annual GDP. Through Operation Phakisa, there is unprecedented inter-governmental collaboration as well as stakeholder engagement, which has already resulted in unblocking access to, finance, land and water for the sector.

To facilitate and fast track aquaculture development, the Aquaculture Bill has been drafted. Government in collaboration with the industry, will further accelerate growth of the sector in terms of jobs and production to meet the aspirations of increasing the aquaculture sector five-fold to 20 000 tons annual production, 15 000 jobs and a GDP contribution of R3 billion by 2019. Government in partnership with private sector will ensure that 24 projects identified in the plan are implemented.

Of the targeted 24 aquaculture projects, nine aquaculture farms are already in production. These farms are located within the Eastern Cape [Hamburg kob and Oyster farms in the Hamburg, Wild Coast Abalone ranching in cape recife], KwaZulu Natal [Dusky kob farm in Richards Bay] and Western Cape [HIK Abalone in Hermanus, Doring Baai Abalone, Saldanha Bay Oyster, Abagold Abalone, Molapong Trout]. We have also implemented an Abalone ranching project in the Northern Cape.

Through the Ocean Economy we will be able to expand fisheries beyond the traditional borders of the West coast to the East and the South and utilise the vastness of the 3 900 km coastline.

Accounting on CASP in Western Cape

The African Union declared 2015 as a year of equality for women, women's rights and women economic empowerment. We are therefore pleased that the Commission for Gender Equality launched the 'One Woman, One Hectare of Land' Initiative for the state to allocate a minimum of one hectare of land to the most vulnerable rural women who are ready and able to use it productively. I have visited Malmesbury in the Western Cape where there are women who have embraced this initiative but to my surprise nobody listens and cares about them when they make a call to the local and provincial governments led by the DA.

Besides lack of assistance to the women, there is a project that has gone from 157 participants to 14 due to lack of support. The project is supposed to be supported with CASP which is transferred from national government to provincial government. The lack of assistance killed the project. So here we are witnessing crocodile tears where the DA is manufacturing unemployment and unfortunately their victims have one colour of the face.

South Africa will further enhance African stature within global agricultural research by hosting the Global Conference on Agriculture Research for Development in Johannesburg in April 2016. This event seeks to promote effective, targeted investment and build partnership, capacities and mutual accountabilities at all levels of the agricultural system so as to ensure that today's agricultural research will meet the needs of the resource- poor end user.

     
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