20 Jul 2021

The new CEDA guidelines have expedited the approval of applications, Minister of Investment, Trade and Industry has said.

Responding to a question in Parliament recently, Mr Mmusi Kgafela said since the launch of the new guidelines on July 15 last year until May 31 this year, CEDA had approved a total of 6 643 loans valued at P696.8 million.

Mr Kgafela said it was important to note that the sustainability of CEDA projects relied on proper credit assessment standards to mitigate any potential business failures.

“The purposes of CEDA funding, profitability and sustainability especially for cattle farming, is dependent on the composition of vegetation, thus sustainable land management is necessary for regular monitoring of range conditions that guide grazing management interventions needed to maintain the ecosystem in the desired state,” he said.

He said the agency had, over the years, acquired massive experience and knowledge on what made successful and sustainable businesses and such requirements had been a result of in-depth diagnostic assessments on both failed and successful businesses.

“CEDA has also assumed the risk of funding on communal grazing areas without requiring the Range Ecology Report, with the risk assumed proportionate to the amount of funding required by applicant,” he added.

The Range Ecology Report, he said was a mandatory requirement for ecology assessment for commercial farmers operating in confined farms and not in communal areas.

Again, he said the report served as mitigation to improve production and a tool to measure loan portfolio performance, adding it should entail ecological surveys that identify the habitats.

“It is meant to provide the status of the vegetation composition in view of ascertaining suitability and carrying capacity of livestock for production in a sustainable manner,” he explained.

Mr Kgafela also indicated that most CEDA clients wanted to buy existing farms and had been used for grazing over extended periods of time, adding in most cases such had been found to be overgrazed therefore compromising the potential cattle business proposed by the applicant.

Meanwhile, Mr Kgafela noted that there were no applications in Kgalagadi South awaiting the range ecology reports.

That, he said was because the report was only mandatory for commercial farmers operating in confined farms and not in communal areas.

Minister Kgafela was responding to a question from Kgalagadi South MP, Mr Sam Brooks who had asked the minister to brief Parliament on the CEDA programme after the new guidelines were introduced.

Mr Brooks also wanted clarity on what impact the submission of Ranch Ecologist report had on processing of applications, as well the number of applications on the waiting list in Kgalagadi South awaiting Ranch Ecologist report submission. ENDS