The economy’s backbone
Informal traders are a key segment in food security, job creation, livelihoods.
If there is anything Covid-19 taught humanity, is how to survive and fight against all odds. Despite the fact that many informal traders are not registered as taxpayers at the South African Revenue Service, the informal economy is one that knows and understands survival too well.
It is reported that, in South Africa, this segment of the economy accounts for between 40% to 50% of sales worth about R360 billion annually. In addition, this segment ensures that residents in townships and informal settlements have access to foodstuffs at their doorsteps, at affordable prices.
About 70% of households in poorer neighbourhoods purchase some of their groceries from the informal sector, a tangible, valid and visible sign of the key part this sector plays in ensuring food security, job creation and livelihoods.
Informal traders were the hardest hit by Covid-19 regulations during the first two weeks of level 5 lockdown due to an oversight of the government to recognise the role that informal traders play in food security.
South Africa has one of the most profound unemployment challenges in the world, with an official unemployment rate that was reported to stand at a staggering 29.1% towards the end of 2019 according to Statistics South Africa.
It is safe to accept that the majority of unemployed South Africans who had joined the informal sector as a survival strategy were gravely affected. In addition, a lot of people lost their jobs leading to unemployment rates reaching 42.6% this year.
Informal traders are also the jewels of the potato industry, said Willie Jacobs, chief executive officer of Potatoes South Africa.
He said their statistics reveal that 66% of all potatoes sold at national fresh produce markets are channelled to the informal sector.
Over the last three years, South Africa produced about 2.5 million tonnes of potatoes annually in 16 different production regions across the country.
South Africa is one of a few countries in the world that can supply fresh potatoes all year round. At primary level, the industry is worth R7.5 billion while at secondary level R26 billion.
The primary potato industry provides work to about 45 000 labourers on about 570 commercial potato farms. Furthermore, it is estimated that between 2 000 and 3 000 small holder farmers cultivate potatoes.
The role that the potato industry plays in contributing towards issues of poverty, hunger and unemployment should not be underestimated.
The United Nations has declared 2021 as the International Year of Fruits and Vegetables with the purpose of strengthening the role farming plays in enhancing food and nutrition security, while providing livelihoods for many rural communities.
When one looks at the economic performance of South Africa in 2020, which is reported as the biggest annual fall in economic activity since the early 1940s, it is good to know that agriculture is among two out of 10 industries that exhibited growth.