Count yourself lucky if economy grows with 3% by 2020- farmers warned
IJG Wealth Management’s Rene Olivier has told farmers that they should count themselves lucky if the local economy manages a 3% growth by 2020, while addressing delegates at the recently held Agricultural Employers Association’s congress.
He indicated the economy continues to experience a weak cycle and can not be stimulated by government due to a lack of money and too much debt.
“It is expected that it will take about two years before the economy in our country will start to grow again. The African Development Bank and Chinese Bank has made investments in Namibia and this will stimulate economical growth.”
“Inflation and interest rates should be looked at and it is expected that inflation will be stable between 4% and 5% in the next few years. It is expected that interest rates will probably not increase in 2018 and 2019,” he said.
Olivier urged farmers to be sustainable and competitive remarking that competition is where profits are made and investors would like to invest there.
"Farmers do not have control over certain aspects such as drought, meat prices, the weather, etc. They do however have control over the management of the farm and will have to farm as effective as possible. The farm must be managed through good and bad cycles.”
“If there is a drought, animals can be bought cheap by those who have grazing land available. Farmers should invest in their farm but will also have to look at their balance sheet,” he said.
He also said that if the farm should stay in the family, they should ensure that the next generation can farm sustainably.
The congress was also in agreement that if farmers complain continuously, the young generation will not be interested to farm.
Pupkewitz Holdings’ Schalk Pienaar also raised questions on how best farmers could get young people back into farming.
“Farming is not only about work but also to enjoy what you do and this is also coupled with labour, sweat and struggle. Young people today view farming as labour intensive and they struggle to get skilled workers. Farm life is also far away from cities and its social attractions and you need a lot of capital to start farming,” he said.
The congress was also in agreement that older generations should hand their farms over to young farmers much earlier and make provision for their own retirement.