Agriculture and poverty in South Africa: can agriculture reduce poverty?

Agriculture and poverty in South Africa: can agriculture reduce poverty?

Investigating the role that smallholder agriculture plays in alleviating poverty in South Africa

Poverty and income inequality persist in South Africa despite efforts to eliminate them. Poverty is more pervasive in rural areas, particularly in the former homelands: the majority (65 percent) of the poor are found in rural areas and 78 percent of those likely to be chronically poor are also in rural areas. This paper investigates the role that smallholder agriculture plays in alleviating poverty and discusses how this role can be enhanced.

The paper begins by presenting some theoretical aspects of agriculture’s contribution to poverty alleviation drawing on literature on agricultural and rural development. Next, the role played by smallholder agriculture in improving livelihoods in South Africa is investigated. The author discusses government initiatives aimed at promoting smallholder agricultural development. These include land reform, agricultural credit, infrastructure and comprehensive farmer support services. Finally, the issue of what needs to be done to maximise agriculture’s contribution to poverty alleviation is addressed. Suggestions include:

  • investing in the ‘prime movers’ of agricultural development through human capital, agricultural research, biophysical capital formation, and rural institutions
  • drawing on lessons from global experience, particularly from Asia’s green revolution – the main elements of which included physical infrastructure, technological innovation and diffusion, fertiliser and chemical application
  • production of high value added products such as animal products, horticulture and beverage crops
  • strengthening farm/non-farm linkages

The paper concludes that promoting smallholder agricultural growth can be an effective strategy to reduce rural poverty and income inequality. However, while agriculture plays a major role in poverty alleviation, the poverty problem in South Africa cannot be solved by promoting smallholder agricultural growth alone. More attention should also be given to the promotion of nonfarm activities. A strategy that pays attention to the strengthening of farm/nonfarm linkages is likely to yield better results in terms of employment and income generation.

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