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Opening Address at the National Wool Growers Conference
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Speeches and Media Releases
 Agriculture & Land Affairs

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 EASTERN CAPE PROVINCIAL GOVERNMENT

SPEECH BY MEC MAMASE AT

THE OPENING OF THE NATIONAL WOOL GROWERS ASSOCIATION

ON 3 AUGUST 2000



1. Introduction

Chairperson,
 Distinguished guests,
 Wool growers,
 Farmers and
Ladies and gentlemen:

I feel privileged and very honoured to be amongst you today. It is through interactive interface like this where common understanding and 
trust is normally developed and achieved between government and farmers. These are opportunities for empowered farmers to demand services 
from service delivery institutions through advocacy and lobbying strategies. This is also an opportunity for me to constantly preach the 
policy objectives of the Department of Agriculture and Land Affairs (DALA) in the province of the Eastern Cape. In return, the farmers are 
expected to react or respond to those policy objectives in the spirit of nation building, economic growth and development, job creation, 
food security, malnutrition and disease control.

Ladies and gentlemen: the policy goal of the department of Agriculture and Land Affairs is to encourage a shift away from subsistence to 
commercial agricultural production or (commodity production) e.g. Wool production is commodity production with an identifiable market.

We intend to achieve this goal of agricultural commercialization through the following four strategic policy objectives;

* promotion of sustainable utilization of natural resources;
* to encourage food and fibre production, thus contributing towards food security;
* to stimulate increased economic activity from agriculture and
* to provide enabling legislation.

Wool growers, having set these policy objectives, the Department of Agriculture and Land Affairs has gone a step further to develop a 
strategic framework for policy implementation. This strategic framework is developed in recognition of the restrictions of current budget 
realities and is comprised of the following elements;

* Land Care;
* Agricultural Advice and Technology development;
* Agricultural and Rural development
* Agricultural Regulation and legislation;
* Administration and Human Resource Management.

Farmers, this is our honest contribution as a department to the fight against hunger, unemployment, malnutrition and disease control. Let 
us discuss the role of "a farmer" in this battle. Given the policy environment as outlined above and the strategic framework to implement 
the policy, in the spirit of Masakhane and of public-private and community, partnership what is your stake as farmers?

2. The agricultural sector in the Eastern Cape Economy

The challenge facing the province is to combat the twin economic ills of poverty and unemployment. The provincial GGP per capita is 
substantially lower than the national average. However, the province also possesses a strong, dynamic and diversified productive sector. In 
1999 the estimated Provincial Gross Geographic Product exceeded R 57 billion. Of this R 57 billion, agriculture’s contribution is only 3,6 
% (R2 063 million). Agriculture also has a contribution of 13,2 % in the provincial employment rate. This does not mean that agriculture 
has lost its importance as an economic sector. As the economy grows and develops, secondary and tertiary sectors grow and develop faster 
and expand.

About 75 % of agricultural income in the province comes from animals and animal products (wool, mohair, hides, meats, milk and cheese 
production).

Wool is produced throughout South Africa but main production areas are the drier regions of the country. On a regional basis, the Eastern 
Cape (including the former Ciskei and Transkei areas) and the Free State each produces just under 24 % of the national clip followed by the 
Western Cape (18,9 %), Northern Cape (12,9 %), Mpumalanga (8.7%) and KwaZuluNatal(2,7%).

Between 90% and 95% of the wool production is exported. The main export destination countries are Italy, France, Germany, the UK, Japan, 
China, Taiwan and the USA. As an export commodity, wool will continue to benefit from the devaluation of the Rand against most user 
currencies. This will have the effect of amplifying an international market upturn, when this occurs, and cushion further drops in 
international price levels, should these continue.

3. The Wool Grower at the Centre stage

Government in general, and the department of agriculture in particular, is trying everything possible to make a difference in the quality 
of life and standard of living of the majority of our resource-poor farmers. Many programmes are in place. The Integrated Livestock and 
Crop Production programme is but one of those programmes. In this programme, National Wool Growers Association (NWGA) is a co-driver. It is 
at this level that the farmer is at the centre stage.

The farmer is an entrepreneur. Entrepreneurship defined as the capacity for innovation,investment and expansion in new markets, products 
and techniques. Entrepreneurship is the key factor in the development process. Entrepreneurs initiate change (they do not wait for 
government to initiate change) and facilitate adjustments in dynamic economies. They are the engines of economic growth. The entrepreneur 
is the one who identifies and undertakes a venture, organizes it, raises capital to finance it and assumes all or a major portion of the 
risk.

The entrepreneur is one of the most responsible people on this Earth. This refers directly to wool growers and all livestock owners in our 
country today. You need support in the form of fencing material for camps, shearing sheds, quality rams, breeding programmes, vaccines, 
veterinary services and dipping infrastructure and material.

Wool growers concur with me, wool production is one of the lucrative enterprises in South Africa today. Over the past three years alone on 
average 90 % of South Africa’s wool production have been exported. How much of that foreign earning has been taxed? How much have you, wool 
growers, ploughed back into your business venture as seed money for infrastructural development fund? How much of it has been used to train 
emerging farmers? I need answers to all these questions. What do you suggest to be done in communal grazing areas to control breeding, 
grazing and spread of sheep scab which affect the quality of wool that is produced in those areas? If fencing material is provided, who 
will look after it and ensure that it is not vandalized and stolen?

Having articulated a few ideas on entrepreneurship above, it is clear to me that, farmers must take the responsibility of farming upon 
themselves. That we as government have to deal with entrepreneur farmers and not rural dwellers. That development does not take place in an 
unstable environment where, there is theft and vandalism. Entrepreneurs initiate change, as entrepreneurs, give us ideas. Entrepreneurs 
base their production decisions on five basic economic questions viz;

* what to produce?
* what method of production to use?
* How much to produce?
* Where to buy and sell?
* When to buy and sell?

The answers to these questions are provided by the market trends with regard to consumer preferences, prices, quality demanded and quantity 
demanded.

4. Agricultural Trade and Development Support Strategy

In line with the policy as discussed, government deregulated the marketing of agricultural products and became a signatory of the Agreement 
on Agriculture of the World Trade Organization (WTO). Essentially this means;

* agricultural production in the country will be guided by the decisions of the producers based on their interpretation of the market 
indicators;
* government will not use regulations or legislation to influence the marketing of products. Price fixing, fixed channel marketing, 
exclusion of products and other non-tariff measures are specifically excluded;
* produce from local producers cannot be given preferential treatment over imported products and will be afforded the same status in the 
domestic market. There can be no regulatory or institutional discrimination between domestic and internationally sourced products, and the 
local and global market will be joined seamlessly;
* the government is able to undertake market development and assist producers in terms of specified domestic support measures as well as 
provisions in the agreement catering for the needs of developing countries.

While all the actions required to liberalize the market and to become part of the global trade of agricultural products have been 
concluded, much still needs to be done to enable the South African producer to take full advantage of the opportunities this policy shift 
offers.

The Trade Protocol negotiations in the SADC region are approaching finalization. A serious farmer/entrepreneur would put his/her ear on the 
ground for market opportunities that may arise as a result of that process.

5. Conclusions

Chairperson, Ladies and gentlemen; you might have noticed that the greater part of this paper talks about the word "Entrepreneur". This is 
deliberately so, because when I made mention of the strategic intent of the Department of Agriculture and Land Affairs, I said, we want to 
see a shift away from subsistence to commercial agricultural production. Rural dwellers and farmers or entrepreneurs are not synonymous in 
anyway. It is through working with serious entrepreneurs only, that we can achieve our policy goal. Entrepreneurs know and appreciate that 
resources are scarce. We need to make choices when allocating those that we have. We need to aim for the highest possible returns.

I thank you all

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