Love thy neighbour

All praise to Lindie Stroebel and her team at the Produce Marketing Association: Southern Africa, who organised the PMA Fresh Connections: Southern Africa Conference & Expo 2016 held in Pretoria recently.

Love thy neighbour
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The presentations and discussions provided insightful and inspiring information about the fruit and vegetable industry in Africa and elsewhere in the world.

I was especially struck by something that Ram Ottapathu, CEO of the Choppies Group (the leading supermarket chain in Botswana), said during his presentation.

Ottapathu discussed some of the common challenges facing fresh produce marketing and trade in sub-Saharan Africa. These include stock availability, logistics and the difficulties of sourcing from small-scale growers, who often struggle to obtain working capital and cannot offer the same security of supply as large-scale farmers.

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He also spoke about the lack of market intelligence to support fresh produce trade in the region, and urged African governments to invest in data collection to improve local promotion and the regional marketing of fruit and vegetables.

But what really got me thinking was his statement that South Africa could not continue to “be an island of productivity within the region”.

Prof Nick Vink, chair of the Department of Agricultural Economics at Stellenbosch University, explained the risks involved in South Africa being a far more productive producer of food than its neighbours, as well as concerns about migration and maintaining a healthy trade environment.

According to him, the likelihood of extensive migration increases markedly when there is a relatively wealthy country within a region with many poorer countries.

This is not necessarily a bad thing for the wealthier country’s economy (although it may place additional pressure on resources), but it does affect the poorer countries negatively. The reason for this is that it is often not the poverty-stricken who migrate, but those with at least some economic means. The poorer country therefore loses some of its workforce, wealth and purchasing power.

For every R1 worth of products that South Africa imports from the rest of Africa, it exports products to the value of R10 to other countries on the continent, says Vink. He describes this situation as “highly unsustainable”.

If South Africa were to continue growing wealthier while its neighbours became progressively poorer, the demand for SA products would eventually decline, as these countries would be unable to afford imported food from South Africa (and those people who could afford it would have migrated here).

In Vink’s words, “we want other African economies to do well because this creates more export opportunities for us”.