South Africa’s R49-billion agro-processing sector plays a significant role in terms of job creation and sustainability in the economy, Trade and Industry Minister Rob Davies said during a meeting with CEOs and representatives of the country’s food processing industry in Cape Town on the weekend.
Davies said that, since the 2008-09 global financial crisis, food processing had grown by over 2% more than South Africa’s manufacturing sector as a whole.
“Despite the continued ripple-effect of the 2008 economic meltdown, food processing continues to be resilient and is one the largest manufacturing sectors by employment – with an estimate of 207 893 jobs in the third quarter of 2013 – against a backdrop of job losses in other parts of the sector.
“It is also significant in value-addition terms, contributing a significant composition of total manufacturing value-added.”
Davies said the government’s New Growth Path (NGP) and National Development plan (NDP) had both identified agro-processing as a sector with high growth potential, despite the challenges of imports competition, loss of market, and the unstable currency and exchange rate.
“South Africa’s agro-processing sector has the potential to become an industrial impetus that can create jobs and answer some of the country’s macro-economic questions, such as trade deficit generated by too much imports against low export volumes.
“An analysis of our imports points to glaring opportunities in articles such as wheat, soy bean, vegetable oils, read meat, tomato concentrates and industrial starch,” Davies said, adding that the government would “intervene and support the sector where it is necessary to remain competitive and stable”.
Davies noted that the government’s Manufacturing Competitiveness Enhancement Programme (MCEP) had identified 564 projects for investment support and approved R1.5-billion for this purpose since its inception in 2012.
He added that South Africa was paying particular attention to the issue of food standards for purposes of compliance with the country’s export markets.
At the same time, the Department of Trade and Industry was working with the relevant industries and the SA Bureau of Standards to develop voluntary standards, to be followed by compulsory specifications, to protect South African consumers from low-quality and fraudulent imports.