Project background
Various government departments have been urged since 2000 to look at areas of highest agricultural potential for improved agricultural production.
Core agricultural strategies have sought to:
- Enhance equitable access to and participation in agricultural opportunities; to deracialise land and enterprise ownership; and to unlock entrepreneurial potential.
- Enhance profitability through sustained global competitiveness in the agricultural sector’s input supply, primary production, agro-processing and agro-tourism industries.
- Enhance farmers’ capacities to use resources in a sustainable manner and to ensure the wise use and management of natural resources.
Through the Accelerated and Shared Growth Initiative for South Africa (AsgiSA), public sector infrastructure investment in the form of bulk water and water distribution has increased and important issues have been tackled.
For example, assets mainly sitting in the hands of black farmers but without commercial value has been addressed through zoning and Agricultural Hubs. Through other support initiatives such as the Orange River Farmer Settlement and Development Programme, 4 000 ha Water Rights Programme and the Land and Agrarian Reform Programme, the Namakwa Irrigation Development was born.
Project description
The project will develop approximately 3 200 ha of high-potential arable land in the Namakwa District. This arable land is located in 11 distinct areas. Each of these have been described, planned and costed individually. Onseepkans has been identified as the pilot to this larger project and the bulk water system is being constructed. Of the identified land, 2 000ha has existing water licences. A further 1 200 ha will have to be secured.
The basket of products to be produced include cash crops such as lucerne and grains, but the bulk of the development is aimed at high-value crops with export potential in order to secure significant growth on the required investment.
This development will generate R521-million per annum in value of production when in full production. It will lead to an increase in the Gross Domestic Product (GDP) of the Namakwa District. Additional value will be added through inputs such as machinery and equipment, chemicals, packing material, fuel, electricity, water, etc. This development would add an additional R200-million to the Namakwa economy on a direct level. Adding the indirect and induced levels, the impact on GDP exceeds R272-million per annum for the entire economy.
Project finance
The project so far has been funded by government through conditional grant funding but it is expected that strategic and equity partners will be invited to participate.
The anchor project of the Namakwa Irrigation Development is in Onseepkans and over R120-million is being spent by government on the bulk water and water distribution networks to irrigate plots and new developments.
A further R30-million has been spent in the development and maintenance of vineyards to produce export raisins. Equity investors and BBBEE investors are sought.
Project status
The anchor project is currently being developed and stakeholders include the IDC and Raisins SA. Bankable business plans and feasibility studies have been conducted.
Partnerships
- Department of Agriculture, Land Reform and Rural Development (Provincial and National)
- Namakwa District Municipality
- IDC
- Khai-Ma Local Municipality
Contact
For more information about the investment opportunity, please contact the team here with reference: Namakwa Irrigation Project.
