SACCI EXPRESS CONCERN AT THE COST OF FARM MURDERS AND/OR ATTACKS

SACCI is becoming increasingly concerned at the cost to the economy of the rising number of attacks and/or murders on farms in South Africa.  With concerns about food security already prevalent both in South Africa as well as globally, the high-rate of attacks on farms can only serve to exacerbate associated risks.

Using the nominal GDP figure for 2009 of R2,4 trillion, a 3,22 per cent contribution of agriculture to GDP and an estimate of 39 982 farms (as at 2007) in South Africa, the cost of a murder/attack on a farm, to the economy, is R1 932 869 per annum.  This estimate assumes a permanent loss of the farming unit.  Assuming that there is only a temporary loss of productivity of the farming unit, the loss to GDP is an estimated R161 072 per month.  This is a modest, conservative approach to the impact of farm attacks on economic output.  It is by no means a comprehensive estimate of economic impact of the attacks on farms or the direct, indirect and opportunity costs of such farm attacks.

These estimates do not factor in different types of farming (opting to use rather a standardised measure), the impact on domestic food security, the repercussions for the competitiveness of the South African agricultural sector, the impact on job security, and the opportunity cost of discouraged potential farmers. This calculation also assumes that all farming units contribute equally towards GDP and that the attack and/or murder always results in a productivity impact/down-time at the farm.

Costs such as these further impede South Africa's currently modest recovery from the global economic crisis. They constitute a hidden, but significant negative impact on small and medium sized enterprises in particular, and add to the cost of doing business. SACCI believes that it is imperative that the causes of the attacks and murders are immediately addressed, not only on moral and legal grounds, but also in the national economic interest.  SACCI will engage the relevant authorities towards developing strategies to curtail the alarming trends in relation to attacks on farms.

Statement issued by SACCI, March 16 2010

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