The government of South Africa through the ministry of Agriculture, Land Reform and Rural Development, has launch a launched a 3.2 billion Blended Finance Scheme with Land Bank to assist farmers.
This partnership aims to support the development of small and medium scale producers to participate in the mainstream agricultural economy and along the agricultural value chain. The objective of the Fund is to make the land and agrarian reform successful by supporting the development, acquisitions and production expansion of qualifying black producers in prioritized value chains.
Blended Finance Scheme
The programme will be implemented over a 10-year period. The funding will be on a blended finance structure which is a combination of a loan and grant with the focus on commodities as per the Agriculture and Agro-processing Master Plan.
Thabi Nkosi, chairperson of the Land Bank, said the department has allocated R325 million per year for the next three years to set up the scheme. The bank would then be matching match this amount on a rand-for-rand basis, bringing the total value of the scheme to R1,95 billion.
“In order to ensure increased affordability and inclusion, and to reduce the risk of failure by new entrants, Land Bank will predominantly follow a blended finance model to support development farmers,” said Ms Thabi Nkosi.
The bank achieved a clean audit outcome for Financial Year 2022 providing an indication of the bank’s sound governance, management controls and processes to enable the successful implementation of the Blended Finance Scheme.
Speaking at the launch ceremony, the Minister of Agriculture, Land Reform and Rural Development Ms Thoko Didiza, said “Strategic partnerships like these are critical to ensure growth, food security, development of farmers and transformation of the agricultural sector, and contribute towards job creation.”
