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SA export taxes could boost local agric market

Written by JFG

Friday, 04 September 2009 02:00

BAMB upbeat about prospects Following reports that South Africa could introduce export taxes to help its agricultural industry, the chief executive officer (CEO) of the Botswana Agricultural Marketing Board (BAMB) Masego Mphathi is already counting his fortunes.  A South African newspaper, Business Day, has reported that the neighbouring country may raise import tariffs and introduce export taxes to help the agricultural industry, citing a trade policy review drafted by the country’s trade and industry department. The proposals are aimed at increasing the competitiveness of the nation’s farm products in global agricultural markets and improving food security, the Johannesburg-based newspaper said. Taxes should be levied on local exporters of raw materials to encourage them to add value to their products before exporting them, the newspaper cited the proposals as saying. The measures acknowledge the sector’s importance after last year’s global food crisis and, if implemented, would constitute a hardening of SA’s stance on open trade. Speaking after the BAMB media briefing at the Finance Park, Mphathi said the development would be a welcome move as it would be important for the development of the local market. Mphathi explained that some farmers shun the local market and prefer the South African market as they say it is cheaper, and said if taxes were to be levied it would improve productivity and they would also not have to rely on imports. The performance of BAMB is dependent on the amount of grains it purchases and trades during the year, and during the past harvest season BAMB purchased 19 000mt of cereals and 7 000mt of sunflower locally. It was reported that these quantities were almost double the previous year’s purchases of about 10 335mt. Mphathi said: “Quantities of produce purchased from local sources in all years under review were far below the local demand hence the Board had to import to supplement local produce. In 2008/9, BAMB imported 12 000mt of sorghum and 2 926mt of sugar beans from South Africa. It is also important to note that the quantities imported by BAMB are a fraction of what the whole industry imported, which clearly shows that there is an ample market for these products that still needs to be satisfied.” On the backdrop of last month’s Memorandum of Agreement signing with the National Development Bank (NDB) Mphathi said BAMB is currently in talks with Citizen Entrepreneurial Development Agency (CEDA) on how they can help satisfy the market. CEDA has since introduced the Young Farmers Fund and offers seasonal loans to farmers, and BAMB currently is the main market for agricultural produce and wants to use their synergies to promote the growth of the sector. BAMB has also been contracted by Government to manage Strategic Grain Reserve (SGR) for ensuring national food security. The management of the SGR has become a major undertaking for BAMB, following government’s decision to increase it from 10 000mt of sorghum to 70 000mt, comprising 30 000mt of sorghum, 30 000mt of maize and 10 000mt of pulses. BY NCHIDZI SMARTS < Prev   Next >

Last Updated on Wednesday, 02 September 2009 18:02