We are living in tumultuous times and in order to move forward, we first need to reflect on what has transpired in the country and in the world in recent months. This was one of the key takeaways from public enterprises minister Pravin Gordhan’s address to farmers and major players in the agri sector today.
Speaking to delegates on the first day of the Agri SA virtual congress, he said that agriculturists need to consider three mega trends when speaking about surviving and thriving into the future.
“The first mega trend clearly is the pandemic and the impact the pandemic has had across the world, both in respect of advanced economies but particularly in respect of emerging and lower-income economies.”
He said that the impact has not only been economic, social, psychological and on health, but in forms we are yet to learn about as we truly move into the post-pandemic period.
The second mega trend is climate change.
“There is an urgency and a need for the world to reduce carbon emissions and various transmissions that different parts of the economy – in our case particularly the electricity and transport sectors – emit,” Gordhan said.
Thirdly, he referred to South Africa’s historical economic patterns of economic growth and a lack of inclusivity. What this brings to the fore, is social and economic development in all of our societal spheres, and the manner in which we deal with them.
“Clearly what that requires, on the one hand, is for businesses to continue as usual but, on the other hand, for thought leadership, business leadership, political and social leadership [to ensure] that we understand what the mega trends mean for our economic sectors.”
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Inclusive economic growth
The mega trends have had an important impact on South Africans in the business sector but it should also inform how we go forward, “as we can see from many other parts of the world with slogans such as ‘build back better’ or ‘build back differently’ or ‘build back in a way in which there are better levels of economic inclusivity’.”
Gordhan said that we should solve the problems of unemployment, particularly in emerging and low-income markets, when we rebuild.
“[The key issue] that we have to ask ourselves questions about – and find very quick answers to – is, ‘What is going to be the future economic model that is far more inclusive, that uplifts millions of people out pf poverty and inequality, and that creates a more just and fairer economic social environment?’ ”
The growth potential of entrepreneurs in agriculture
Gordhan further said that the agricultural sector in particular has an important role to play in the GDP of the country: although it makes a numerically low contribution, the potential is quite great. Its contribution to food security in the South African context is also quite critical.
He highlighted certain sections of South African agriculture that have been hugely successful in increasing their productivity and diversifying from traditional to cash or export crops.
But even with more productive agriculture and, in fact, as a result of it, young workers will continue to leave the countryside and flock to urban areas. “They will be employed not in factories but in informal micro enterprises in low-productivity services with poor expansion prospects,” he said, and urged policy makers to ensure that the next generation of growth policies are targeted to increase productivity at the lower end of the economic scale.
“By offering a range of public services, and with the help of technology, business plans, regulations and specific skills, government can unlock the growth potential of the entrepreneurs among them.”
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