by Greg Penfold

Editors Note

greg penfold.jpeg

Commercialisation is the word of the moment, with the announcement in April that the Land Bank has set a target of making available “at least” R1-billion in funding over the next year in order to support black agricultural entrepreneurs, with particular emphasis on transforming its R39-billion oan book, the vast majority of which is still accounted for by loans to established commercial farmers.

The announcement comes at a good time. Nobody can deny that land reform has dragged on interminably, with stakeholders seemingly never able to come to agreement between practical commercial considerations and ideological imperatives. Now the Land Bank has a plan that, if it succeeds, won't throw the baby out with the bathwater. That's because it recognises that land redistribution has to be coupled with the necessary ability to farm the land commercially. As Deputy President Cyril Ramaphosa commented at the time, "Inclusive growth requires that we redistribute agricultural land on a far larger scale and at a far quicker pace; and that we properly equip the new owners of that land to farm it productively and sustainably."

One of the most interesting developments is the reported design of "corporate farming investment structures" for black entrepreneurs to acquire and manage portfolios of agricultural assets. The details are not clear yet, but reportedly the Land Bank has in mind is a means to commercialise unused land currently held by the State, mines and farmers, in a manner that may resemble the competitive bidding process for independent power producers.

Given that the Renewable Energy Independent Power Producer Procurement (REIPPP) programme stands out as a South African success story, it is to be hoped that the Land Bank can emulate its success in the agricultural domain.

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