South Africa’s agricultural growth in the first 30 years of the democratic era has been supported by, among other things, two pivotal interventions. The first was a deliberate and concerted strategy to invest in genetics for crops, horticulture and livestock, and the second was a strong push to expand export markets. As production continues to increase and capacity for expanding production remains available, these two levers must be accelerated.
The department of agriculture must support new ethical breeding techniques that the private sector presents occasionally, as they may be vital for continuous productivity improvement. More importantly, with climate change and the increasing frequency of extreme adverse weather conditions, improved seed cultivars that cope with such environments will become critical in supporting our agricultural system. Therefore, crop and livestock breeding should remain a priority policy area for SA as an anchor for food security and agricultural production progress.
Equally important is boosting exports to new frontiers while maintaining access to the existing markets in the EU, Africa and elsewhere. Admittedly, SA is the only African country in the top 40 global agricultural exporters, with an export value of $13.2bn in 2023 and ranked the 32nd largest agricultural exporter in the world. But accessibility to these markets is not guaranteed.
In an increasingly fragmented world and various recent incidents of non-tariff import barriers, paying particular attention to nurturing existing markets and opening new ones will be vital. SA already has experience of protectionism in the EU, with barriers in citrus, and in the SA Customs Union (Sacu), where Botswana and Namibia have targeted SA vegetables and citrus.
The trade issues are not purely economic but political, which means SA’s political leadership must take a clear stand and focus on retaining the existing markets through dialogue with the political leadership of the countries where we continue to experience challenges.
The departments of trade, industry & competition, and international relations & co-operation must be at the forefront of these efforts, supported by scientific insights from the department of agriculture.
On a positive note, international relations & co-operation minister Ronald Lamola has made it clear that diplomacy must be aligned with economic interests. While in the past his department may not have played a leading role in economic discussions, in today’s world, where geopolitical tension has spilt over into trade, this department should even be more prominent in promoting SA’s economic interests.
The Sacu issues should be the first test case. At the same time, the EU challenges are now part of the World Trade Organisation processes after SA formally lodged a case against the economic bloc.
Also important in the near term is the upcoming Brics+ summit in October, which will take place in Russia. While this grouping is not a trade bloc, using the structure to push more ambitious trade matters is vital. Agriculture is one of the SA economic sectors that would benefit from deeper trade relations with the other Brics+ countries. As things stand, SA agriculture has not benefited much from trade with this grouping.
Before adding other members at the 15th summit in Johannesburg in 2023, the original Brics countries accounted, on average, for just 8% of SA’s agricultural exports. For comparison, the UK alone accounts for roughly 7%.
From 2019 to 2022 the original Brics countries’ agricultural imports averaged $255bn a year, according to Trade Map data. China and India accounted for the bulk of these imports. Despite these sizeable agricultural import figures, intra-Brics agricultural trade remained relatively low.
Remarkably, the products these countries imported from the rest of world are similar to what some Brics countries, such as SA and Brazil, produce in surplus.
This year SA’s message in Russia should focus on building on the spirit of the 2023 Johannesburg summit, which promoted dialogue about deeper agricultural trade.
Written for and first published in the Business Day.
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