Stakeholders must work together

Two of the biggest sectors driving the Eastern Cape economy are the automotive and agricultural sectors, which boast significant export figures to the rest of the world.

The two sectors have weathered unprecedented events in the past three years.

However, the recently published Automotive Export Manual 2023 released by the Automotive Industry Export Council (AIEC) shows the export value of vehicles and automotive components from SA comprised a healthy 12.4% of total South African exports last year.

The export value of vehicles increased to a new record high last year, and while the outlook for vehicle exports according to the AIEC’s report for this year mentions the same myriad of challenges experienced last year, including supply chain bottlenecks and the energy crisis, it is expected that exports will continue on a steady trajectory.

Similarly, the 23rd KPMG Global Automotive Executive Survey predicts the automotive sector will be faced with an array of opportunities and challenges, but says auto executives globally are confident that the industry will achieve more profitable growth over the next five years.

However, with a growth rate well below 1%, the SA economy is struggling with interest rate hikes and inflation.

The AIEC reports that prepandemic growth levels are only expectednext year in the country.

While comprehensive reports such as by the AIEC and KPMG are not available for the agricultural sector, there are a few additional storms this important sector of the Eastern Cape economy had to weather recently, which are unique to the sector.

The most recent concern is avian influenza, commonly known as bird flu, that was again detected in SA — worrying at commercial layer farms in the Western Cape where thousands of birds died or had to be culled last month.

A huge contributor to the agricultural exports, the South African Poultry Association has called for SA to consider adopting a vaccination policy, instead of a culling policy, during avian influenza outbreaks.

Greater oversight and vaccination control could also minimise the threat other diseases such as foot-and-mouth disease (FMD) will have on the export of animal products.

This is particularly significant for the Eastern Cape agricultural sector which suffered a crippling ban in wool exports due to an FMD outbreak.

Last year, exports of local wool to China were banned for five months.

All stakeholders should work together to address these varied challenges in the agricultural and automotive sectors to keep SA — in particular, the Eastern Cape — open for export business.

It is only then that we will be able to return to pre-pandemic levels of growth to ensure the prosperity of the region, and its people.