1. 1 Interventions to deal with the food crisis: South Africa Simphiwe Ngqangweni Senior Researcher, National Agricultural Marketing Council (NAMC) Secretariat, FANRPAN South Africa Node www.namc.co.za Presented at: FANRPAN 2008 Regional Stakeholders Policy Dialogue Lilongwe, Malawi, 03 September 2008

2. 2 Contents Problem statement Approaches to addressing the problem Conclusions

3. Problem statement 3 Wheat: 107.1% Yellow maize: 144.1% Soybean: 114.7% Rice: 218.4% High commodity prices

4. Problem statement 4 Lower availability of grains for food Use in biofuels Increased demand for animal protein Unfavorable climatic conditions

5. Problem statement 5 Competing uses of maize Feed and industrial uses have become important

6. Problem statement Other dynamics of the problem:  Increasing purchasing power of the newly-affluent  Trade restrictions  Potential misuse of market power  Increasing energy costs  Inadequate investment in agriculture 6

7. Problem statement Effects of the problem:  At country level: RSA as net staple food importer, will struggle to meet domestic demand in the long- term.  At household level: the poor are the hardest hit due to unaffordability of food.  The nutrition of the poor is also at risk  Rural areas are most affected due to high poverty rates: 54.2% (Household); 67.7% (individuals) 7

8. Approaches to addressing the problem Both short and medium- to long-term interventions are required In the short-term:  Safety-net measures: social welfare grants, food parcels, starter-packs for HH backyard gardens, school feeding schemes These programs are in place – administrative challenges in some areas still exist. Some of these programs are currently being expanded. 8

9. Approaches to addressing the problem In the medium- to long-term (expand production):  Enhance profitability and competitiveness of primary commercial agriculture: certain forms of indirect subsidies are being debated in RSA  Improve efficiency along agricultural value chains: deal with misusers of market power & price colluders, remove barriers to entry for smaller players, improve agro-logistics  Accelerate entrance of new agri-entrepreneurs: implementation of the land and agrarian reform program & dealing with institutional challenges 9

10. Approaches to addressing the problem In the medium- to long-term (continued):  Create PPP’s that work (leverage private sector resources and expertise) to bring in new entrants into the mainstream economy – there are local examples to learn from  More collaborative platform in addressing trade and tariff issues  Take a (SADC) regional approach whereby greater production of staples by RSA neighbors with better comparative advantage is encouraged (in the context of the SADC FT Protocol/FTA) 10

11. Conclusion A two-pronged approach:  Respond to the needs of the most vulnerable in the short-term  Exploit opportunities to expand food production in the medium- to long-term, take a regional approach Encourage public-private partnerships 11