Smallholder Farming: a Panacea for Employment Creation and Enterprise Development in South Africa? Lessons from the Pro-Poor Value Chain Governance Project in Limpopo Province

"Recent government efforts point to the smallholder sub-sector as a potential source for employment creation and enterprise development. This paper presents an analysis of smallholder farmers’ market participation and the potential links to rural poverty using the case of Limpopo farmers. The study showed that smallholder farmers are confronted with complex marketing arrangements which are different from the conventional dichotomies. An analysis on the margins showed that local channels (hawkers) allow them to realise bigger margins compared to those offered by formal channel (processors). The results also suggest that informal market channels should not be overlooked as they can play an important role in improving rural livelihoods through job creation and enterprise development. The study is inconclusive on whether smallholder farmers are a panacea to the challenges of rural poverty in South Africa, but it illustrates the linkages between smallholder farmers’ market participation and rural poverty."