launched the Micro Agricultural Financial Scheme of South Africa (MAFISA), in
the Western Cape at Elsenburg, today
26 October 2006
About 46% of South African households are considered poor or low-income,
with more than 15 million poor people living in rural areas in South Africa;
while over 60% of black households can be defined as low-income and rely mostly
on the informal sector for an income. It is estimated that 60% of South
Africa's people live below what the United Nations (UN) describes as the
poverty line.
A recent analysis indicated that more than 80% of South Africa's adult
population has been denied access by the formal banking sector and conventional
credit facilities. It is therefore difficult for poor people to get out of the
poverty trap.
The Western Cape provincial Department of Agriculture has a duty and a
responsibility to make a meaningful contribution, together with our colleagues
in the public sector and in partnership with the private sector and civil
society, to help people use the natural resources in a profitable and
sustainable way in order to protect the resources for future use by our
children.
The Government has developed an appropriate policy and system that will
contribute to assisting the working poor to run existing agricultural
businesses, start new agricultural businesses and be able to develop these into
commercially viable operations.
He said that, MAFISA confirms our commitment to continue our search for
better ways of providing financial support to the rural sector in order to
benefit the rural poor. It is understood that the Scheme does not cover all
fields of intervention and cannot be mechanically applied. It needs to be
adapted to the socio-economic setting of each area, and leave room for
financial innovations beyond the scope of this Scheme.
Government's desire to establish MAFISA is driven by the following policy
objectives:
* to re-establish an agricultural credit scheme through the Department of
Agriculture, targeting the micro and small agricultural and related
business
* to provide capital to increase agricultural and other forms of related
activities.
Government set up MAFISA to drive and facilitate the development of
financial services, which will contribute i.e. to develop very small and micro
level farmers, farm workers, farm tenants, small landholders, the landless,
emerging farmers, processors, micro-entrepreneurs, and the working poor.
The people who could qualify for MAFISA financial assistance must:
* be active within the agricultural sector, whether it is in the rural or
peri-urban areas
* be able to embark on self-help initiatives to:
(i) improve their livelihoods
(ii) reduce poverty
(iii) develop viable businesses
(iv) show potential to graduate into larger commercial businesses
* be able and willing to repay the money they borrow.
For the 2006/07 production season, MAFISA will run a production credit
scheme on a pilot basis in the municipalities of Swartland and Berg River in
the West Coast District Municipality, and Witzenberg in the Wineland District
Municipality, respectively.
Farmer businesses, which qualify, will be able to borrow up to R100 000, at
an affordable rate. Application forms will be available at the Land Bank and
local provincial Department of Agriculture's Extension Officer in the
municipalities.
Minister Dowry urged all role-players to work together to make this pilot
project a success to extend this scheme to other areas of the Western Cape
province.
Enquiries:
Alie van Jaarsveld
Tel: (021) 483 4930
Fax: (021) 483 3890
Cell: 084 604 6701
E-mail: avjaarsv@pgwc.gov.za
Issued by: Western Cape Provincial Government
26 October 2006
