South Africa faces significant challenges of high unemployment, weak economic growth prospects, rising poverty and inequality. These are issues that should dominate the thinking of the political leaders, business and society at large.
Finance Minister Enoch Godongwana delivered the 2023 budget speech in a uniquely challenging environment. Global economic growth is slowing, from an estimated 3.4% in 2022 to 2.9% in 2023. The domestic challenges, particularly the energy crisis, remain a significant constraint to growth, with the South African economy expected to grow by less than 2% through 2025.
According to Agbiz chairperson, Francois Strydom, “President Cyril Ramaphosa’s State of the Nation Address (SONA) spoke to most of the critical issues facing agribusiness today namely energy security, logistics, water security and infrastructure. We hope that the new positions being created within the Presidency will provide the necessary impetus for solutions to be found as business need urgent interventions.”
Agbiz welcomes the decision of the People’s Republic of China to once again accept wool exports from South Africa. The decision is a welcome development within the context of an increasingly volatile environment for international trade.
Agbiz participated in signing the Agricultural and Agro-processing Master Plan (AAMP) yesterday before Minister Thoko Didiza delivered the Department of Agriculture, Land Reform and Rural Development’s budget vote speech in Parliament. The document was co-signed with government and organised agricultural groupings, signalling an end to the first phase of the process, which started with the Bureau for Food and Agricultural Policy (BFAP) and the National Marketing Council (NAMC) drafting the initial concept document and ended in tough negotiations between social partners. The AAMP includes a list of economic enablers and targeted interventions needed in the livestock, field crops, horticultural and agro-processing subsectors to unlock inclusive growth.
The Agbiz Congress 2022 takes place just as the world and South Africa are emerging from the Covid-19 pandemic, which led to increased unemployment and constrained economic growth. On the back of the pandemic, the Russia-Ukraine war has introduced new uncertainties, particularly for agricultural trade and food prices. The 2022 Agbiz Congress will therefore be focused on sustainability and resilience in the face of uncertainty.
Agbiz is deeply concerned about the human loss and disruptions in the global supply chain as a result of the conflict in Ukraine. “Both countries are notable role players in the global agricultural product and agricultural input markets. For South Africa's agribusinesses, the fruit industry has strong ties with the Black Sea region as it is a major export destination for horticultural products. The effects of the war will be felt across the globe as the spillover is likely to disrupt energy prices, global payment systems, shipping lines and agricultural inputs such as fertiliser," says Agbiz chairman, Francois Strydom. There is also pressure on businesses that import grains and farming inputs from the Black Sea region. "We are watching the developments closely and hope there could be a diplomatic solution," added Strydom.