Posted on November 15, 2023

South Africa: White Farmers Barred from Export Market Unless They Hand Over Farm Ownership to Blacks

Dawie Boonzaaier, Rapport, November 12, 2023

Farming enterprises that are “too white” will no longer be allowed to export products to Britain and the European Union (EU).

This rule has been implemented by stealth through new regulations published in the Government Gazette in terms of which famers must comply with black empowerment demands before they will be granted export permits for Europe.

Only farming enterprises with an annual turnover of less than R10 million per year are not covered by the new rules, but there are few export enterprises who produce on such a small scale. [ZAR 10 million = GBP 436,000; USD 533,000]

The DA [Democratic Alliance, official opposition in parliament] has already lodged complaints with the EU and British trade offices.

The Department of Agriculture, Land Reform and Rural Development introduced the new rules concerning the export of agricultural products on 31 October and 1 November with announcements in the Government Gazette.

Milk, cream, butter, fruits, nuts, sugar, jam, fruit puree, fruit juices, yeast, grapes, and wine are some of the products affected by the announcement.

South Africa’s agricultural exports last year generated some R240 billion in revenue. Of this, 20 % was to the EU, and 4% to Britain.

According to the Government Gazette, all applicants for export permits must adhere to the act on broadly based black economic empowerment as well as the AgriSEB [SEB = “Black Economic Empowerment,” BEE, in Afrikaans] sector code.

Nok Masipa, DA MP and party spokesman on agriculture, said the new rules are “the bureaucratic equivalent of a pencil test on South African agricultural exporters.”

[The “pencil test” is a test ascribed to the apartheid era when officials supposedly tested for nonwhite ancestry by seeing if a pencil could stay stuck in a person’s hair or not. If it fell out, that person was “white,” if it stayed in, that person was “nonwhite.” This test is a myth, and never actually happened, but has become urban legend as a test of racial ancestry.]

Masipa laid complaints this week with the EU trades Commissioner, Valdis Dombroivskis, and the British minister of trade and commerce, Kemi Badenoch.

“This regulation contravenes the rules of reasonable trade which underpin agreements between the EU Britain and South Africa. These agreements are expressly grounded on the protection of human rights, democratic principles, and the primacy of law.”

According to Masipa, the new demands contravene all three principles.

“As well as calling upon the EU and Britain to pressure the South African government to reverse this discriminatory policy, the DA requests that this transgression be placed before the European Parliament for review in terms of our economic partnership agreements.”

Dr. Theo de Jager, head of Saai [The Southern African Agri Initiative] said the new rules would cripple agricultural exports and make it extremely difficult for farmers to remain internationally competitive.

“How do you enforce SEB in a family farm? It is difficult enough for a father and son to farm together, or nephews, not to even consider a partner from outside who is forced upon your farming enterprise?” De Jager asked.

De Jager said the government was now trying to shift responsibility for transformation on farmers because its own efforts at land reform over the last quarter century have been a failure.

“If the regulations are implemented as they stand, it will mean that individual families will foot the bill for a national transformation goal in which the state has clearly failed.

“The state has not even been able to draw up a list of land claims 25 years after the cutoff date for such claims expired. They should have long since created a competitive black farmer class. Now they are shifting responsibility to family farmers who are already operating in a negative policy environment which is set up against them, and at the same time competing for shelf space against the best producers in the world.”

De Jager agreed with the DA that the export regulations “fall far outside the framework of acceptable international protocols.”

“BEE demands on the export of agricultural products will place agriculture on the same road as Denel, SAA, the SABC, and public healthcare,” warned De Jager.

[Denel was the South African arms manufacturer, SAA is the South African Airways, the SABC is the South African Broadcasting Corporation, all of which have either failed completely or partly bankrupt.]

“The damage will quickly become too large to be repaired. Saai will fight against this in every local and international forum, in courts and the multilateral agencies of the United Nations and the African Union.”

Masipa pointed out that the export permit regulations were just the latest of a number of racially-based policies enforced by the government.

The recently amended Employment Equity Act has set targets for companies with 50 or more employees.

If these companies do not adhere to these guidelines, they can be fined for amounts up to 10% of their entire turnover all be forbidden to do business with the government.

The government has really been threatened with legal steps over this law.

In addition to this, the government announced regulations in May this year spelling out racial quotas for the use of water.

In terms of these regulations, enterprises which use or store water will not be granted water licences unless they have a black shareholding of between 25 and 75%.

De Jager said that the government had already tried to link export permits to racial quotas. In 2021, the council for the export of perishable products sent letters to farmers asking them to hand in their AgriSEB certificates.

This attempt led to strong resistance from the agricultural community and ultimately failed.

He said the government has no idea of the impact these new regulations will have.

“No viability or impact studies have been done. It is a cheap political initiative in the run-up to the 2024 election.”

AgriSA said it would first study the new regulations before it gives any comment.

The Department of agriculture land reform and rural development did not respond to several requests for comment.

[Editor’s note: This article was translated from the original Afrikaans.]