A Rich Man’s Hobby

December 2003
Robin Sherbourne (Institute for Public Policy Research Opinion No.11)

Argues that the price of commercial farmland in Namibia is high in relation to the profits that can be made from commercial livestock farming. As a result, farming is rapidly becoming the preserve of the urban rich who farm as a lifestyle choice and are prepared to subsidise their farms from their principal sources of income. Government policy is trying to encourage black Namibians into commercial farming through the Affirmative Action Loans scheme. However, given the price of land, many of these farmers will struggle to create commercially viable farms. This is bound to cause frustration further down the road and new farmers will start to demand more subsidies to purchase farms and diversify into other activities that will allow them to raise their incomes. Government will then have to decide whether to increase subsidies to encourage broader land ownership or simply allow those who can afford to farm to benefit from land reform.