Members of Parliament serving on the Portfolio Committee on Agriculture, Land Reform and Rural Development are not fully convinced that the agriculture sector in South Africa is ready for the implementation of the Africa Continental Free Trade Agreement (AfCFTA).
The committee recently held a virtual meeting with the Department of Agriculture, Land Reform and Rural Development to discuss AfCFTA, as well as the department’s implementation of the Covid-19 Agricultural Disaster Support Fund.
AfCFTA is an initiative by African countries to promote intra-African trade, create bigger markets and improve the prospects of the continent to attract investments.
Committee members raised concerns about the high costs of exporting within the continent, as well as poor infrastructure such as roads and rail networks. They said the challenge of Africa is poor road and rail infrastructure that makes the movement of goods too costly.
Members claimed that red tape and high costs resulted in many exporters deciding not to trade in the continent. Other members wanted to know how was the agreement going to make sure the cost of doing business in the continent is affordable for small-scale producers, when currently even commercial farmers can’t afford it.
Ms Thembeka Mbabama, who is a member of the committee, said AfCFTA “seems a very great initiative but we have not seen any plans. The department has not been successful in helping small farmers reach the local market, how do we make sure our farmers are ready to take up opportunities brought by this new treaty”, she asked the department.
The committee heard that AfCFTA will bring together the 55 member states of the African Union to create a single continental market for goods and services and allow free movement of people, goods, services and capital. It will also accelerate the establishment of a Customs Union.
The agreement seeks to achieve the creation of a single larger preferential regional market for African products through negotiating progressive elimination of tariffs; the elimination of non-tariff barriers and enhancement of the efficiency of customs procedures and trade facilitation.
The department told the committee that the agreement, which was launched in 2018, also seeks to achieve the development of harmonised product standards, technical regulations, sanitary and phytosanitary (measures for the control of plant diseases) measures and conformity assessment procedures, as well as other measures to enhance economic development, diversification and industrialisation across Africa.
Regional integration is the central aspiration of the African Union’s Agenda 2063 and remains a critical component of the content’s efforts to ensure sustainable economic development and inclusive growth.
Mr Mduduzi Shabane, the department’s Director-General, said they were aware that small-scale farmers currently face barriers to enter the market in South Africa and that there were also other challenges in the system from the government side, such as access to water, energy and affordable credit. He said plans were in place to implement programmes to prepare smallholder farmers for participation in AfCFTA.
The committee was also not pleased to hear that the department has only approved 28% of applications for the Covid-19 relied fund, calling on the DG and his team to relook their decision.
“Subsistence farmers, those planting for survival, are the hardest hit by coronavirus and they form a bulk of the unapproved applications for the relief fund. If we don’t do something, we are not fighting food insecurity. In your next level, you need to cover these people,” said another committee member, Ms Manketsi Tlhape.
The DG told the committee that any future interventions will depend on whether the National Treasury took some funds from the department’s budget. The National Treasury is in a process of reprioritising the national budget and cuts are expected for some government programmes.
By Sakhile Mokoena
20 May 2020