Thank you Programme Director,
It is my honour to share my speech at the Produce Marketing Agents (PMA) Fresh Connections Southern Africa. The theme of “taking fresh to the next level” resonates well with the objectives of the agricultural, forestry and fisheries sectors, with specific reference to the fresh fruit and vegetable industry.
I am impressed by the number of international industry leaders and experts who are participating in this event. I am hopeful that the insights shared at this event will assist South Africa and other Southern African states to further comprehend nuances of trade within the complex global economy.
I have noted the attendance of the Deputy Secretary of Agriculture of the United States Department of Agriculture - Honourable Krysta Harden. A special South African welcome to you Deputy Secretary and I wish you fruitful deliberations. I have just written to Secretary Tom Vilsack to update him on sanitary issues relating to the trade between South Africa and the United States of America.
It is important to note that the African Growth and Opportunity Act (AGOA), provides tremendous benefits to the countries of Sub-Saharan Africa (SSA) and we are hopeful of continued support of South African participation in AGOA.
Opportunities for South Africa to trade in agricultural commodities are of critical importance to our objectives of ensuring food security, economic growth and job creation. Agriculture has been identified as one of the key economic drivers in South Africa. President J.G. Zuma, in his State of the Nation Address earlier this year, pronounced on a “Nine-point Plan”, which is meant to deepen the National Development Plan (Vision 2030). At the apex of the “Nine-point Plan” is the revitalisation of agriculture and agro-processing value chains.
The revitalisation of these value chains through the Agricultural Policy Action Plan (APAP) reflects our commitment towards South Africa maintaining a competitive edge in trading in agricultural commodities within a market-led global economy.
Programme Director, the fresh produce value chain, which forms the core of APAP, is currently accounting for the majority of South Africa’s exports and foreign earnings and the bulk of our jobs in agriculture. In the context of the region, South Africa has sophisticated supply chains and in combination with the South African retail chains in Africa provides a basis for expansion and a model for many African neighbours.
South Africa has already been a dominant global player, where for example, South Africa is a leading global exporter of citrus and macadamias and is currently becoming an important player in apple and other fruit exports in Africa along the growth of South African-based distribution chains. It is an opportune time to converge business and government interests in opening new markets, especially fast growing markets in Africa and Asia.
Programme Director, the President has also tasked our sector to bring 1 million hectares of land into production and fruit and vegetables present a viable option. However, water constraints necessitate the application of new water technology to stretch production expansion. We are working with the Ministry of Water and Sanitation towards creating an attractive environment for expansion in fruit and vegetable production.
Government in partnership with industry and investors aspires to create a million additional sector jobs in South Africa, which would better be expressed in an increase in sustainable commercial businesses linked to emerging components of the economy, in the next 15 years in the agriculture, forestry and fisheries food value chains. The fresh produce commodity value chain provides the highest return on investment to realise a million jobs.
I would like to highlight that in South Africa, national fresh produce markets play a vital role in fresh produce marketing. Key players in the fresh produce industry have, over the years, raised several concerns regarding the state of infrastructure and service standards in these markets and the urgent need to address such backlogs. To respond to such requests, my department undertook numerous investigations followed by a scoping exercise to various markets to assess their status.
General findings from the assessments conducted indicate that indeed the majority of national fresh produce markets’ service standards have declined, and therefore, urgent remedial actions need to be undertaken to rescue the markets from further deterioration and possible total collapse. To this effect, we have commissioned Project Rebirth and I thank all the stakeholders who are assisting in addressing the challenges of our fresh produce markets.
Globally, there is an awareness and recognition that diets rich in plant nutrients combined with animal protein are healthier, and as consumers earn more, they consume more of these products. Fresh produce is also of higher value and has higher labour multipliers compared to traditional grain and starch production.
These characteristics together with global demand growth owing to population growth by another 2 billion people by 2050 and an increasing global middle class with more disposable incomes in developing economies, makes the fresh produce sector ideal for sustained growth and development. This has to take place alongside the advancement in technology and optimal water use. Technology partners have become a key to expanding the sector.
Programme Director, Africa accounted for the majority of the land acquisitions area in the world and together with South America, are the only two continents that will be able to supply the bulk of the world’s surplus produce in the next three decades. New large investments in farmland in Africa are mostly coupled with the value chain investments. This trend provides opportunities for the South African industry to African and regional development. Africa only contributes around 4% of global exports by value, while just less than a quarter of exports were intra-African. Africa has to push for greater contribution in global export by value.
We have also seen other eastern African countries such as Kenya, Tanzania and Uganda developing as fresh-producing exporter countries in a short period of time. High value horticultural exports from eastern Africa increased almost tenfold over the past decade to close to ten billion US dollars. Preferential agreements with Europe and preferential access to the US markets made a significant contribution in some cases. Fruit, nuts and vegetables are high value goods and also make possible the sustainable participation of smallholders in the global markets if they are part of a sophisticated value chain or within such a cluster and can link up with export facilities.
It is very important for such farmers to get the correct technical assistance, and this is where large exporters play an important role in human development. As the necessary infrastructure, transport and logistics networks are in place and cross-border facilitation are also in place, Africa could emerge as a net trading giant and a source of global fresh produce in the next three decades.
In the context of recent developments and the momentum that will accelerate over the next three decades, it is important that role players such as PMA foster healthy fresh produce networks in the region. The PMA has an American origin and it could become a truly global organisation as its successes are duplicated in other continents. Good research is the foundation of evidence-based decision making.
If an organisation such as PMA can contribute to the research agenda to benefit its members in growing, it can truly make a contribution to promote opportunities. Further network collaboration is important in the region, as the sum total of regional networks is more than its individual contributions as the continent becomes increasingly interconnected. South Africa can be the source of technology and knowledge proliferation as the region develops and as South Africa also remains closely linked to other global technology partners combined with our own world class research and educational institutions.
The PMA can also play an important role in national and regional health and awareness with its campaigns.
I wish you all fruitful deliberations and expanded trade in South African fresh produce.
Thank you.
