Analysing the socio-financial determinants shaping food production in the South African agriculture sector

Thomas Habanabakize and Zandri Dickason-Koekemoer

Cogent Economics & Finance, 2024, vol. 12, issue 1, 2426541

Abstract: The 2023 Sustainable Development Goals (SDGs) encompass a specific objective that is to ‘end hunger, achieve food security, enhance agriculture, and improve nutrition’. The realization of this goal relies heavily on efficient agriculture sector management in developing countries. Consequently, assessment of factors that influence agricultural production is one of the way to solve issues that hinders the attainement of the SDGs. This paper aims to investigate the determinants of food production within the South African agricultural sector. Employing econometric methods like Johansen and Canonical Cointegration, VAR and VECM, this study analyes annual time series data spanning from 1961 to 2022. The analysis indicates that factors such as accessible financing, heightened agricultural sector investment, fertilizer usage, and rural demographic growth positively influence food production; contributing to mitigating food insecurity in South Africa. Conversely, elevated lending rates and inflation pose challenges to South African food production. Thise results indicate the role played by monetary policy to improve food production in South Africa. To bolster food production in South Africa, policymakers shoul focus on enhancing agricultural skills, easing credit conditions to improve financial accessibility, and encouraging active investment from government and private sectors in agricultural activities.The current study offers vital insights into the multifaceted determinants of food production within the South African agricultural sector, directly contributing to achieving the 2023 Sustainable Development Goals (SDGs), particularly the aim of “ending hunger, achieving food security, enhancing agriculture, and improving nutrition.” By employing rigorous econometric analyses on comprehensive time series data, this research enhances the existing literature by identifying and elucidating various bottlenecks that obstruct production growth in the South African agricultural sector. Additionally, the study conducts a thorough investigation into the impact of key factors of production in agriculture, providing evidence-based recommendations and robust strategies designed to alleviate hunger and malnutrition through enhanced food production techniques. It underscores the critical significance of targeted investment growth, agricultural skills enhancement, and improved financial accessibility as essential strategies for boosting agricultural productivity. The findings are not only relevant to South Africa but also offer valuable lessons for other developing countries facing similar agrarian challenges. By illuminating the pathways to improved food production and food security, this study serves as a foundational resource for policymakers, agricultural practitioners, and other stakeholders striving to create sustainable food systems that can effectively eradicate hunger and elevate nutrition standards on a global scale. This study highlights the usefulness of a collaborative approach incorporating government initiatives, private sector investments, and community engagement to foster a resilient agricultural sector capable of adapting to changing socio-economic conditions.

Date: 2024
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DOI: 10.1080/23322039.2024.2426541

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