22 January 2016

South Africa: R32 Milion Relief Support for Commercial Farmers

Pretoria — The Industrial Development Corporation (IDC) has made available soft loans as emergency funding towards working capital, infrastructure and a small portion for carry over debt for the commercial sector.

Giving an update on the status of drought relief support to the agriculture sector at a media briefing in Pretoria on Friday, Agriculture, Forestry and Fisheries Minister Senzeni Zokwana said an amount of R32 million had already been approved.

"The IDC will consider financial assistance to its existing clients that apply for drought relief support while for non-IDC clients, lending will not be made available directly to the end-beneficiary but rather through National Credit Act compliant intermediate like Land Bank and AgriBusiness," Minister Zokwana explained.

The Minister explained that the loan agreement will be entered into between IDC and the relevant intermediary.

"These intermediaries will have to apply to the IDC on a case by case basis and a due diligence will be applicable."

In relation to the directive, Minister Zokwana said the department had given provinces 20% - or R226 million in total - of the Letsema grant.

Provinces that have applied and received approval include KwaZulu-Natal, Free State, North West, Limpopo, Gauteng, Mpumalanga and Northern Cape.

The Eastern Cape applied this week, while Western Cape has not yet reprioritised, the Minister said.

In Limpopo, an additional amount of R51 million has been set aside, with R20 million going towards the procurement of fodder to assist smallholder and subsistence farmers, while R31 million for livestock water.

The Free State has allocated R10.692 million and R29 million from its Equitable Share and Comprehensive Agricultural Support Programme (CASP) budget to assist subsistence, smallholder and commercial farmers to deal with the current drought.

The Gauteng province has to date spent R6 200 00 on animal feed, water infrastructure, phosphate licks and de-silting of earth dams.

A total of R7 717 080 was approved in the Northern Cape and has already assisted 257 farmers and helped in the distribution of 2 500 tonnes of fodder during a period of October and November.

The North West has made available R25 million for drought relief. As at 18 January 2016, 5 7010 bags were distributed and 10 228 farmers received assistance.

An amount of R114 million was allocated in Mpumalanga for procurement of inputs for livestock, water harvesting and aggressive de-worming of livestock, borehole drilling, amongst others

Meanwhile, Minister Zokwana met with MECs responsible for agriculture to take stock of the current drought and to discuss the ongoing relief support provided to affected farmers and livestock owners.

Rural Development and Land Reform Minister, Gugile Nkwinti also joined the meeting, where the principals engaged on plans and solutions they can employ from now on.

Minister Zokwana acknowledged that there was a clear picture of the negative impact of drought on crop production, livestock, agro-processing and agriculture infrastructure, as well as food security in all affected provinces.

"Planned sectorial achievements on priority areas like outcomes 4, 7 and 10 will not be accomplished as planned because food and feed grain prices will surge debts levels and job loses," the Minister noted.

He highlighted that the department's priority is on developing and implementing climate change adaptation plan and programmes for the sector.

"We will give more support to Climate Smart Agriculture in terms of conservation agriculture."

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