November 27, 2020
World Market

Agriculture

South Africa Should Prioritize Access To Markets In India

South Africa is an established player in global fruit exports, especially citrus. However, it has failed to take full advantage of the rise in demand, especially for high value fruits such as berries and avocados. Countries that have successfully done so, like Mexico and Peru, increased their fruit exports by up to 15% per annum between 2013 to 2018. In contrast, South Africa’s fruit exports only rose by 3% over the same period. The one success story has been citrus. The country’s share in the top six citrus exporting countries more than doubled from 6.6% to 15.7% between 2001 and 2017. It is now the second largest exporter of citrus globally.

Success of the citrus industry has been largely bolstered by research, innovation and technological developments, driven by the industry association - Citrus Growers Association (CGA) - in collaboration with government. These are critical aspects in maintaining markets, negotiating new markets and complying with sanitary and phytosanitary standards imposed by different importing countries.

This success demonstrates what is possible with concerted and coordinated action for fresh fruit. The Public-Private Growth Initiative announced by President Cyril Ramaphosa at Business Unity South Africa’s 2019 Business Economic Indaba suggests that there is an appetite for collaboration between industry and government on targeted initiatives.

As part of the initiative, the agriculture sector proposed a business plan to create 120, 000 jobs by 2023. The business plan acknowledges the role that high-value fruit can play in creating jobs but there appears to be no prioritisation of how the different sub-sectors in agriculture will contribute to the overall objective. Research conducted by the Industrial Development Think Tank (IDTT) shows that targeted interventions in high-value fruit alone could create about 100, 000 jobs by 2023.

A number of bottlenecks need to be addressed to realize the job opportunities. These include improving access to export markets, addressing congestion at the ports and improving the rail and logistics infrastructure. With regard to access to markets, South Africa should prioritize high growth markets in South and East Asia. These include China, Vietnam, Thailand, South Korea and India. In the last five years, Chinese imports of fruit and nuts grew at a compound average growth rate of 38%. However, South Africa can only export citrus, table grapes and apples to China.