South Africa launches fund to boost Black farming

South Africa has set up a 5 billion rand ($340 million) fund to boost Black farming by having access to capital and to also boost their role in commercial agriculture.

This was disclosed by the state-owned Industrial Development Corporation (IDC) and the government  on Thursday.

The joint Agri-Industrial Fund is aimed at easing the funding constraints and entry barriers to commercial agriculture facing Black farmers, the IDC and the agricultural and land ministries said.

“The broader agricultural sector is central to the recovery of the local economy, but most importantly, this Fund’s objectives are consistent with the IDC’s role in increasing the number of black commercial farmers,” said IDC CEO Tshokolo Nchocho.

The IDC will provide 4 billion rand via debt and quasi-debt over the next three years while the government will provide a grant of 1 billion rand, the IDC said.

Access to funding has become more challenging for new farmers after state-owned Land Bank, the country’s largest agricultural-focused lender, missed debt repayments last year and had its credit rating cut, forcing it to seek financial assistance from the government.

MTO/Reuters