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Western Cape Business 2017 edition

  • Text
  • Agriculture
  • Maritime
  • Development
  • Gan
  • Network
  • Cape
  • Africa
  • Government
  • Business
  • Economy
  • Investment
  • Business
  • African
  • Sector
  • Banking
  • Provincial
  • Economic
  • Municipality
The 2017 edition of Western Cape Business is the 10th issue of this highly successful publication that, since its launch in 2005, has established itself as the premier business and investment guide to the Western Cape province. The Western Cape has numerous promising investment and business opportunities and this issue includes contributions from Alan Winde (Minister of Economic Opportunities for the Western Cape Government), interviews with Ryan Ravens (CEO of Accelerate Cape Town), Arifa Parkar (Western Cape Business Opportunities Forum CEO), Wesgro CEO Tim Harris and Lance Greyling (Invest Cape Town) as well as contributions from various business leaders. In addition, you will also find comprehensive features on all the key sectors in the Western Cape.

OVERVIEW Agriculture

OVERVIEW Agriculture Processing plants boost rural employment. While the contribution of agriculture to provincial gross domestic product (GDP) is small at 4.2%, the fact that nearly 40% of exports from the Western Cape derive from fruit or agri-processing makes this a vital sector to the health of the regional economy. Seven of the 10 biggest export earners are either agricultural products or agri-processed goods. In the national context, agricultural products made up 5.2% of the country’s export basket in 2015. The African continent accounted for 22.7% of total exports. Wheat is another of the province’s strong sectors: the Western Cape’s 310 000ha planted to wheat in 2015 represented 64% of South Africa’s crop. Japan is a major destination of the province’s maize production. In canola, the Western Cape is even more dominant, with 99% of the nation’s hectares. (StatsSA). A working group of the Protein Research Foundation is developing strategies to increase the yields and plantings of canola. A canola symposium was held in Bredasdorp in 2016. The province’s climatic regions vary from Mediterranean around Cape Town and on the coast (where rainfall can be 2 000mm at places) to the drier regions of the inland Karoo districts where annual rainfall SECTOR INSIGHT A new testing centre will be built in the Western Cape to certify agricultural products for export to the EU. figures can be below 150mm. Just over three-million hectares of the province is cultivated and 270 000ha are under irrigation. The sector supports almost 10 000 farms and employs 214 000 people. Farming carried out on the Western Cape’s 13-million hectares of agricultural land comprises approximately 21% of South African commercial agriculture. The Provincial Government of the Western Cape has identi- WESTERN CAPE BUSINESS 2017 74

OVERVIEW fied agri-processing as one of the three key sectors that can deliver high growth and lots of jobs. Over a five-year period to 2014, the sector grew at nearly 5% and delivered jobs growth of more than 7%. Agri-processing holds potential to increase employment in rural areas. If it receives the dedicated attention and support, it could add up to 100 000 jobs and generate R26-billion for the economy under a highgrowth scenario. Among the areas on the todo list of Western Cape Minister for Economic Opportunities Alan Winde, whose ministry is responsible for agriculture, is to bring more irrigated land on-stream to increase product into the agri-processing chain; to keep promoting wine sales to the world; to expand African exports (Angola is proving a good first step); investigating whether the Western Cape can tap into the global halaal market said to be worth .3-trillion; and to build a testing centre for agricultural products so they can be certified for sale into the European Union (EU). Zoning laws also have to be adopted to promote growth in rural areas. He gives an example of a fruit pulping and drying company in the small town of Gouda, which was restricted by zoning laws when it wanted to expand its factory space beyond 1 000m². “They are growing at 65% and you are telling them to pack up and move to the city? Gouda loses 1 000 jobs!” Winde says that it must be the objective of government and planners to create an enabling environment for companies to expand. In presenting his 2016/17 budget, Minister Winde said that the number of jobs in the agricultural sector had grown by 63% in a year, citing StatsSA data. This figure included seasonal jobs. Many more opportunities for employment may come about if the trend reported on by City Press in August of 2016 grows bigger: experienced citrus farmers moving to the Western Cape from other areas. Reporting that five farmers from Limpopo and the Eastern Cape had bought farms in Citrusdal, Robertson and Wellington, the newspaper noted that the variety of new fruit types (apart from lemons and other citrus fruit) to be planted by these new farmers would supply work all-year round for local people. Mandarins, seedless watermelons and squash are among the other fruits. There is also good news for agriculture in the Western Cape – out of Gauteng. South African Breweries has built a new malting plant in that province. To get to an annual production figure of 130 000 tons of malted barley for the new facility, more barley will have to be grown. The locally-sourced barley that SAB buys will rise from 65% to 95% of total stock. The company’s only other malting facility is in the heart of barley-growing country, at Caledon in the Overberg region, where 180 000 tons are processed every year. The Western Cape is a major producer of fruit and vegetables and is by far the biggest producer of peaches in South Africa. The country produces about 60 000 tons per year. Only 1% of South Africa’s fruit is dried, but that still represents 51 000 tons of product. The Western Cape is strong in dried fruit and nuts with Montagu Dried Fruit and Nuts, Cape Dried Fruit Packers (also based in the Boland town of Montagu), and Safari among the biggest producers and distributors. POSITION COMMODITY AMOUNT 1 Refined petroleum R18.2bn 2 Citrus R8.6bn 3 Wine R8.6bn 4 Apples and pears R6bn 5 Grapes R6bn 6 Iron and steel R3bn 7 Fruit juice R2.2bn 8 Fruit and nuts R2.1bn 9 Tobacco R1.8bn 10 Engine parts R1.6bn Top 10 exports 2015 SOURCE: QUANTEC, 2015 75 WESTERN CAPE BUSINESS 2017

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