‘Economic genocide’- New rules mean only BEE farms can export

New regulations published in the Government Gazette will create a financial famine among white farmers who export produce to Britain and the European Union (EU). That’s because very soon, they will not be allowed to earn an income by shipping food offshore.

The regulations were gazetted on 31 October and on 1 November.

It means that any farm turning over more than R10 million annually must be in black hands if it wants to export either as a Level 1, 2 or 3 contributor to broad-based black economic empowerment (B-BBEE).

In essence, this means that family agribusinesses passed on through generations, for example, must now be shared out to achieve empowerment status or face financial ruin.

“The EFF sings about killing the boer already, now the ANC-led government will successfully kill the farmer,” said Bronwyn Engelbrecht, provincial spokesperson for agriculture, land reform and environment for the Democratic Alliance (DA) in Gauteng.

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“This is economic genocide on a grand scale.”

Products that South African agribusiness exports to other markets include, among others, dairy, processed fruit like jams, sugar, fruit juices and purees and wine. All these will now be subject to the new regulations.

“Is the government intent on breaking every part of the economy?” asked economist Dawie Roodt. He said the move was tantamount to the pursuit of ideology at any cost, dressed up in a dinner jacket of racism.

“It is destructive, counterproductive and I cannot see that these regulations will ever see the light of day. Our trading partners like the EU, Britain and the United States simply will not tolerate such draconian behaviour.”

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ActionSA leader Herman Mashaba said that at a time when SA was suffering from several economic pressures, and people were affected by a stubbornly high unemployment rate, government should do everything in its power to make it easier for local businesses to do business.

A source told The Citizen that SA was already skating on thin ice with the US and at risk of being kicked out of Agoa, an opportunity to deliver ease of business for South African companies. This might just be the straw that breaks the camel’s back.

AfriForum’s Willie Spies said the notion that a R10 million-turnover farm would be highly profitable was an exaggerated myth. He said agriculture was a capital-intensive industry and while the turnover might look solid, a R10 million topline would probably yield a profit of R500 000.

“It will simply annihilate farming and agribusiness to have to comply with B-BBEE before they are allowed access to overseas markets,” he said.

“The irony is that as more farms go out of business because of this, the very people that the ANC wants to aid ideologically will be at the losing end.”

Engelbrecht noted that the regulations would also disincentivise agriculture to produce more food, and in turn, impact food security and any kind of growth in foreign earnings for the country’s economy.

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Mashaba said: “As we have seen with broad-based black economic empowerment, these regulations then benefit a select few while the majority of black South Africans remain excluded.”

Engelbrecht said: “Black economic empowerment remains an important form of restitution for our country, but government has failed in its land reform project. It has been busy with this for three decades. Now, because of that, they are trying to force successful farmers to pay for their mistakes as a deflection of their dismal performance in terms of agricultural reform.”

Charles Cilliers of the Patriotic Alliance (PA) agreed that government had been unsuccessful.

“We are all South Africans and BEE has failed. It has helped destroy our state-owned companies and has become a sin tax on doing business in South Africa, which was not what was supposedly intended by the law, which was to help fix the injustices of the past. The PA’s policies on race are clear and it’s time to do away with racial categorisation.”

Engelbrecht said: “This has nothing to do with restitution as it will just create more divisions between people. Instead of government empowering and enabling farmers now they are trying to take from Peter to hide their failures with Paul. I have seen so many small black farmers in Gauteng desperate for assistance from government. But it’s like waiting for Godot, the help never comes. The promises are legion, the delivery naught,” she added. 2

The DA has already laid complaints with Britain and the European Union.

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Spies suspects that government will ultimately remove white farmers from the economy altogether.

He likened it to a new kind of apartheid and noted that according to the Rome Statute of the International Criminal Court, the chipping-away of a certain population group’s economic participation was tantamount to exactly that.

Spies said AfriForum planned to investigate the matter further and challenge it in court as the organisation had successfully done in the past with other attempts.

Mashaba said ActionSA would also consult with its legal representatives to see what steps could be taken to reverse or change the new export regulations and engage with the minister and department of agriculture to see if different measures could be taken to achieve similar goals.

Engelbrecht said: “The ANC must be desperate to get re-elected next year. Pity it’s on the back of an industry that brings in more than a quarter-of-a-billion-rand into the country every year.”