The Jobs Fund, which was established by government to facilitate sustainable employment amongst previously disadvantaged South Africans, youth and women, recently announced three landmark partnerships that will successfully broaden the inclusion of previously disadvantaged individuals in South Africa’s agricultural sector.
The Fund has a large agriculture portfolio and recognises that development in this area is fundamental for supporting rural economies and livelihoods, inclusive economic growth, food security and broad transformation in the sector.
Three new agriculture projects were recently awarded grant funding from the Jobs Fund and have already begun implementing development initiatives that will benefit emerging farmers and jobseekers across all nine provinces in South Africa. On top of the R359 million Jobs Fund investment, these projects have invested a further R494 million, taking the funding available for investment in agriculture to R853 million.
Figure 1: Geographic areas of initiatives’ implementation.
|Project name||Project partner||Provinces|
|International Blueberry Enterprise Initiative||Atlantic Black||Northern Cape, Western Cape|
|Pick n Pay Enterprise Academy National Suppliers||Pick n Pay Foundation||Free State, North West, Gauteng|
|Commercialisation of Black Producers Programme||Department of Agriculture, Forestry and Fisheries||All provinces|
Boost for the blueberry industry
The Jobs Fund partnership with Atlantic Black (Pty) Ltd aims to transform the local blueberry industry by including previously disadvantaged farm workers in the mainstream blueberry market. In partnership with ABSA, Topfruit, Southern Cross Marketing and Management and Haygrove, the Atlantic Black project will leverage matched funding of almost R184 million off a R49 million Jobs Fund grant.
According to Najwah Allie-Edries, head of the Jobs Fund, the funds will be used to, establish a 50ha blueberry orchard in the Western Cape, part-owned and 100% operated by previously disadvantaged South Africans. The blueberry operation will target the annual gap in the European berry market from October to February.
By leveraging the skills, experience and contacts of the partners invested in the consortium, this ground-breaking project will extend training, management and global export and marketing expertise to previously disadvantaged local workers, most of them women. The project is expected to create 852 jobs, consisting of 70 permanent, 570 seasonal and 212 short-term jobs, and is supported by an employee equity scheme.
“This partnership marks the debut of previously disadvantaged South Africans as suppliers to the rapidly growing European berry market,” says Allie-Edries. This is a milestone for transformation in the agricultural sector, “providing a blueprint for broader inclusion in this strategic high-end and high-quality export sector.”
Commercialising marginal agricultural enterprises
In a separate partnership, the Department of Agriculture, Forestry and Fisheries (DAFF) is matching a R300 million Jobs Fund grant with R300 million of their own funding. Working with the Land Bank and the National Agriculture Marketing Council, the combined R600 million pool will, develop high potential emerging agricultural businesses, whose current turnover is between R200 000 and R500 000, into commercial enterprises, according to Allie-Edries.
This enterprise development initiative, which will be implemented across all nine provinces, is a pioneering partnership that will capacitate emerging commercial farmers and marginalised agroprocessing SMEs, by helping them invest in production inputs and infrastructure, coordinate technical support, and build successful businesses able to access markets.
The project focuses on relatively high growth and high labour absorbing sectors such as citrus, macadamia, vegetables, livestock and cotton. All beneficiaries are expected to create further employment as their enterprises grow, broadening the ecosystem of inclusion among rural communities in South Africa.
“Importantly, candidates will be required to have significant skin in the game,” says Allie-Edries.
All beneficiaries will need to demonstrate that they have contributed their own funds to the business or derive 80% of their personal income from operations. Candidates will also be required to demonstrate significant non-financial contributions to the business through full time involvement, land ownership, water rights or recognised agricultural qualifications or other relevant skills.
In addition to supporting 108 black-owned and currently marginalised agricultural enterprises to commercialise their operations and access established value chains, “this innovative partnership with the Department of Agriculture, Forestry and Fisheries demonstrates how different sources of government funding can be combined to catalyse commercial activity among South Africa’s significant emerging farmer sector,” explains Allie-Edries.
The project with DAFF will train 7 812 project beneficiaries and create 5 483 jobs, consisting of 1 715 permanent, 3 720 seasonal and 48 short-term jobs.
Support for emerging inland operations
In a smaller, although no less significant R20 million partnership, the Jobs Fund, working with the Pick n Pay Foundation in partnership with the SAB Foundation, is supporting five emerging inland farming operations to become sustainable commercial agricultural businesses.
Figure 2: Project funding and job creation figures.
|Project name||Project partner||Total funding||Grant funding allocated by the Jobs Fund||Match funding committed by project partner||New permanent job target||Seasonal job target||Short-term job target||Internship target||Trained beneficiary target|
|International Blueberry Enterprise Initiative||Atlantic Black||R233 112 485||R49 380 726||R183 731 759||70||570||212||1||71|
|Pick n Pay Enterprise Academy National Suppliers||Pick n Pay Foundation||R20 000 000||R10 000 000||R10 000 000||53||104||14||50|
|Commercialisation of Black Producers Programme||Department of Agriculture, Forestry and Fisheries||R600 000 000||R300 000 000||R300 000 000||1 715||3 720||48||108||7 812|
|R853 112 485||R359 380 726||R493 731 759||1 838||4 394||274||109||7 933|
Pick n Pay has identified that small-scale farmers seeking to supply retailers with produce, often lack collateral to raise funding to expand their businesses and struggle to meet food safety requirements. Previously disadvantaged small-scale farmers in South Africa also lack the logistics infrastructure needed by retailers – especially the pack houses required by legislation.
The five enterprises, which represent both fresh produce and livestock producers, will be assisted to register their businesses, develop their products and services, set up bookkeeping and cash flow management systems, comply with packaging and labelling legislation, provide product traceability, and meet food safety audit requirements.
Thereafter they will be registered on the Pick n Pay portal, enabling them to access the logistics required to place their products on Pick n Pay shelves.
In addition, Pick n Pay will provide the five beneficiaries with favourable rebates, preferential trading terms, a dedicated mentor, financial training, access to corporate experts, networking support, and firm off-take agreements with Pick n Pay. Significantly, the off-take agreements will enable beneficiaries to leverage further funding from commercial banks, the Industrial Development Corporation or the National Empowerment Fund.
Beyond assisting five previously disadvantaged and marginalised emerging farmers to access mainstream agricultural and retail supply chains, this partnership will create a total of 171 jobs, consisting of 53 permanent, 104 seasonal jobs and 14 short-term jobs, while also training 50 beneficiaries.
If successful, this high impact partnership will be taken to scale across South Africa.
These three agricultural partnerships selected by the Jobs Fund are particularly relevant to South Africa’s current debate on land reform. “All three represent practical and achievable routes to broader inclusion that leverage partnerships with existing mainstream expertise and assets,” explains Allie-Edries. “Furthermore, the success of these partnerships is largely underpinned by the ability of the Jobs Fund grant to leverage additional investment by both private and public sector players, thereby significantly increasing the impact on target beneficiaries.”
All three partnerships highlight the agricultural sectors’ broad and largely still untapped potential to extend inclusion by “successfully creating jobs and building sustainable livelihoods among South Africa’s largely marginalised rural communities,” concludes Allie-Edries. – Press release, Jobs Fund