As the country prepares to host the G20 summit later this year, the agricultural sector has a lot to offer and learn from other countries which can help the sector to grow and create jobs, writes Agbiz chief economist Wandile Sihlobo. South Africa’s chairing of the Group of 20 also means the country leads the G20 business forum, the B20.
South Africa’s agenda is “Solidarity, Equality, and Sustainability.”
The G20 comprises 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Saudi Arabia, South Africa, Russia, Turkey, the UK, and the US) and two bodies: the African Union and the European Union.
The B20 brings together business representatives from the G20 countries and sets out workstreams that take their cue from the theme defined by the government, though its actual work is autonomous.
Time to take the lead
As a critical stakeholder in the B20, the South African agricultural sector must outline bold goals.
There should be a strong call for knowledge sharing on climate-smart agricultural practices. This theme is relevant not only for the G20 countries but also for the African continent. There is much more to learn from the experiences of Australia, Canada, the EU and others.
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South Africa must open an avenue for this discussion. The insights must be canvassed with the continent to help improve Africa’s agricultural resilience in the challenging climatic environment.
South Africa should pursue deepening agricultural trade. As a country, we already enjoy access to several G20 economies. Still, prioritising trade integration and ensuring the policies of relatively open borders on agricultural trade are maintained is vital. This point is essential in this climate of trade fragmentation and “friendshoring”.
South Africa’s agricultural sector is export-orientated. Therefore, it is in businesses’ interest to ensure practices are maintained. Africa as a whole, whose agricultural sector still faces productivity challenges, may not benefit as much as South Africa from this theme in the near term. However, in the long run, the benefits will be widely shared.
South Africa should continue prioritising discussions about deepening the fertiliser trade in Africa. Sub-Saharan Africa (excluding SA) has poor agricultural productivity due to various factors.
One challenge is poor fertiliser usage and another is lack of access to affordable finance. More fundamentally, conducive infrastructure is essential to ensure the fertiliser reaches the farmers and their produce gets to market.
Linking the fertiliser matter with a need for investment in network industries is therefore key. If political leaders want to raise a theme that would have a broader positive continental impact in reducing hunger, a discussion about fertiliser would be worthwhile.
This would also entail thinking about ways to raise funds to buy and distribute fertiliser to the most vulnerable regions of the continent. Improvements in agriculture will help reduce hunger.
We know from the literature that growth in agriculture is generally two to three times more effective at reducing poverty than an equivalent amount of growth generated outside agriculture. Moreover, the advantage of agriculture in reducing poverty is largest for the poorest individuals in society and extends to other welfare outcomes, including food insecurity and malnutrition.
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Innovation in agriculture
South Africa must discuss sharing insights about agricultural technology and investment opportunities. This workstream would involve most mechanical and IT-related technologies, which are increasingly vital for agricultural productivity and the efficiency of food value chains.
The G20 countries are advanced in this area of work, and knowledge sharing would be beneficial, mainly for the broader African continent. SA, therefore, has good reason to support this theme.
The South African government should define a clear agenda that considers Brazil’s outcomes and charts a new path. This work needs to start sooner rather than later.
South Africa’s businesses must first undertake detailed thinking and formulate priorities linked to the economy’s sectors.
The next step is to engage the government in such priority areas. This will help ensure South Africa formulates an inclusive agenda for the B20 that aligns well with the G20 priorities.
- Wandile Sihlobo is the chief economist of the Agricultural Business Chamber of South Africa (Agbiz). The views and opinions expressed in this article are those of the author and do not necessarily reflect the views or positions of Food For Mzansi.
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