Applications have opened for a new multimillion-rand Wine and Spirits Fund, established through a partnership between the European Union (EU) and the South African government. The initiative aims to accelerate transformation in the country’s wine and spirits sector, historically one of the least inclusive value chains in local agriculture.
The fund forms part of the Support Programme for the Transformation of the Wine and Spirits Sector in South Africa, created under a financing agreement (ZA/DCI-AFS/040-854) between the European Commission and the Republic of South Africa. It focuses on two components: transformation of the sector, and marketing and distribution to non-EU export markets.
Land Bank will manage the R195m transformation component, while the National Agricultural Marketing Council (NAMC) oversees the R98m marketing and distribution component.
Driving transformation in the value chain
The fund is designed to enable meaningful participation of Black-owned enterprises within the wine and spirits value chain.
"South Africa is recognised as one of the leading countries in the production of wine, which is exported throughout the world. Land Bank is delighted by the support of the EU. It will drive a transformation agenda in the wine and spirits sector, which has historically not been fully inclusive in its production value chain,” says Themba Rikhotso, Land Bank chief executive officer.
EU backing for sustainable growth
Sandra Kramer, the EU Ambassador to South Africa, noted the importance of the initiative:
"Our partnership for the transformation of South Africa’s wine and spirits sector is indeed groundbreaking. We will support the South African Government to ensure a sustainable transformation of the sector, including support for more equitable access to land and infrastructure, education and training, as well as socio-economic development.
"It will also ensure sustainable marketing and distribution of South African wines and spirits to third-country markets, particularly Black-owned brands."
Funding structure and criteria
The EU has committed a €10m grant contribution to the programme. Successful applicants will access either a direct grant or an “equity contributor”.
• Grants range from R500,000 to R3.5m, aimed at business development needs.
• Equity contributor funding will leverage capital from Land Bank and other financial institutions for amounts between R3.5m and R10m.
Applicants must meet several qualifying and selection criteria, the primary one being that businesses are Black-owned and managed enterprises operating within the wine and spirits sector.
