Treasury’s support to Land Bank is a food imperative

21 October 2020

Agri SA calls on National Treasury to urgently consider supporting the Land Bank’s request of R18 billion over 5 years in order to ensure the bank’s sustainability.

Over the last few months, Agri SA has come to learn of the increasing liquidity constraints of the Land Bank resulting in the risk of inability to support the agricultural sector.

“Currently, the Land Bank finances 29% of the agricultural debt, making it a critical contributor to food security,” said Christo van der Rheede, executive director of Agri SA. Since April 2020, the bank cannot service its debtors, placing the going concern status of the Land Bank at risk.

Currently, no new clients are being considered and clients are encouraged to seek financing from other financial institutions. Moreover, the critical development role that the Land Bank needs to fulfil, is compromised.

“As an institution, it is an important vehicle to finance new entrants into the sector, said KulaniSiweya, agricultural economist at Agri SA.

According to the presentation by the Land Bank to the Parliamentary Select Committee on Finance, the Land Bank ’s funders have indicated that there will only recommit funding on the back of state guarantees.

Agri SA encourages the agricultural community to step into conversation with the Land Bank on the status of their facilities.

Issued by Christo van der Rheede, Agri SA Executive director, 21 October 2020