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March 01, 2009

New farmers face ruin in South Africa

by Bongani Mthethwa

Emerging farmers on eight of the biggest farms in SA’s fruit-basket region have been saddled with massive debt by a company set up by the government to support them.

The company, South African Farm Management (SAFM), was appointed by the Land Claims Commission as a partner to provide management expertise and capital for farms in Mpumalanga and Limpopo that had been newly acquired as restitution.

Now SAFM has gone into liquidation, allegedly owing more than R100-million. The future of the fruit farms that were claimed by the Masakona community and others in the Levubu Valley hangs in the balance.

The Masakona people were among seven communities, including Tshitwani, Tshivhazwaulu, Tshakhuma, Ravele, Ratombo and Xigalo, that inherited 7810ha of the prime Levubu estate in Louis Trichardt).

They produce bananas, avocados, litchis, macadamias and mangoes.

Engelina Ramulondo, a spokesman for the Masakona people, said they had been shocked to discover that SAFM had allegedly borrowed R5-million for them from Absa.

“We were not aware that SAFM had secured a loan on our behalf and now we’re sitting with a debt we don’t know how to settle,” she said. She said that since SAFM had taken over management of their eight farms in 2005, “we never got a cent from them.”

She said that even though they had paid SAFM thousands of rands every year for chemicals to treat their crops, the company had failed to provide them. Pumps were no longer working. The community also claimed to have paid SAFM R56000 for hired tractors.

“The farms are now on the verge of collapsing because we don’t have the money to sustain them,” said Ramulondo.

Ramulondo said they would be able to save their farms if:

  • They were taught skills, such as exporting, management and sales;

  • They were given extra tractors and irrigation equipment; and

  • They were given money to renovate the farms.

    The future of several other farms in Limpopo and Mpumalanga are affected, including the 1000ha Lisbon estate, one of the largest fruit farms in the Lowveld. It was once the country’s main grapefruit exporter.

    The acting chief land claims commissioner, Andrew Mphela, said he was aware that SAFM was being liquidated.

    The Department of Agriculture was taking the lead in helping affected farmers avoid job losses.

    Mphela said Lisbon estate had been considered by Absa to be “a mouth-watering prospect.”

    “What happened with the project was a simple question of mismanagement,” he said.

    He said affected projects included three in Mpumalanga, four in Levubu and Mamahlola in Limpopo.

    SAFM spokesmen were not available.

  • The Times

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