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South African Business 2019 edition

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The 2019 edition of South African Business is the seventh edition of this annual guide to business and investment in South Africa. Regular pages cover all the main economic sectors of the South African economy and give a snapshot of each of the country’s provincial economies. Feature articles on topical issues such as Special Economic Zones and African trade provide unique insights, together with comprehensive overviews of critical economic sectors. Other special features focus on the exciting new possibilities in renewable energy, airports as engines of regional growth and the maritime sector as an entirely new prospect for South African entrepreneurs and businesses. South African Business is complemented by nine regional publications covering the business and investment environment in each of South Africa’s provinces. The e-book editions can be viewed at www.globalafricanetwork.com

OVERVIEW where

OVERVIEW where investment will pay off are bringing under-utilised land (in communal areas and land reform farms) into commercial production, expanding irrigation schemes and targeting areas that have the highest potential for growth. Fruit, sugar and wine make up about 7% of the country’s total export basket. Avocadoes, tomatoes and macadamias are among other important export crops. Primary agriculture provides 5% of formal employment in South Africa. Several of the Special Economic Zones around South Africa either have or will in the future have, agri-processing facilities. Examples include existing tomato paste and dairy facilities at Coega IDZ and plans to develop the SEZ at Harrismith (Maluti-A-Phofung) into a hub for agri-processing. The Nkomazi SEZ in Mpumalanga will promote agri-processing and the Mpumalanga International Fresh Produce Market currently under construction in Mbombela will boost the agricultural sector in the region. ONLINE RESOURCES Agricultural Research Council: www.arc.agric.za Fresh Produce Exporters’ Forum: www.fpef.co.za Grain SA: www.grainsa.co.za National Department of Agriculture, Forestry and Fisheries: www.daff.gov.za SA Table Grape Industry: www.satgi.co.za Agricultural variety A total of 70% of South Africa’s grain production is maize, which covers 60% of the cropping area of the country. The South Africa feed industry has an annual turnover of about R50-billion with most of the raw material being soya and maize. KwaZulu-Natal and Mpumalanga produce sugar, but volumes are down. The Free State Province supplies significant proportions of the nation’s sorghum, sunflower, potatoes, groundnuts, dry beans, and almost all of its cherries. Products distinctive to South Africa, such as rooibos tea (Western Cape) and marula berries (Limpopo) hold great potential to capture niche markets internationally. South Africa is famous for its fruit, of which 35% is citrus, 23% subtropical and nuts, 26% pome fruIt, 11% stone fruit and 9% table grapes. Export volumes, particularly in tropical fruits such as mangoes and avocadoes, have been growing rapidly. Most of South Africa’s citrus and subtropical fruit comes from the eastern part of Limpopo. There are about 3 500 wine producers in South Africa, with the large majority located in the Western Cape. The industry earned R17.5-billion in exports in 2016. Livestock farming is the largest agricultural subsector in South Africa and the Eastern Cape is the largest livestock province. South Africa has a beef-herd of 14-million. South Africa produces about 55% of the world’s mohair. SOUTH AFRICAN BUSINESS 2019 68

facilitator of world class services for South Africa and the rest of the Realising continent long-term by participating in the following sectors travel & tourism, media, value and driving food & logistics, and property. transformation Thebe Food and Agro-processing. areas of energy, resources, power, infrastructure as well as water. The Services Division seeks to become a FOCUS The Thebe Food and Agro-processing subdivision of Thebe Investment Corporation aims to realise long-term value from its investments in the food production and preparation sectors and to drive and champion transformation in the agro-processing sector. We achieve this through investing in and managing strategic agro-processing assets with an explicit aim to develop and facilitate the integration of black farmers and agro-processors into established supply chains. The long-term aspiration is to be invested in leading operators that operate across the continent. Thebe Food and Agro-processing intends to continue to build a significant food services CONTACT DETAILS Contact person: Mokgethi Tshabalala (General Manager, Thebe Food and Agro-processing) Tel: +27 11 447 7800 Email: mokgethi@Thebe.co.za Website: http://new.thebe.co.za/ company by 2020. Key to this strategic intent are four main drivers, namely food production and exports, food processing and distribution, food marketing, and an emerging farmers development programme. Thebe is currently exposed to the food sector through its investment in Compass Group SA, a leading industrial caterer, and GROW (formerly BothaRoodt), a fresh produce market agent at the Johannesburg Fresh Produce Market and HarvestFresh. In South Africa, CGSA, in which Thebe has a significant shareholding, caters for a variety of clients including private sector, government and education institutions. Partner company Compass Group PLC is one of the largest food services and facilities company in the world, operating in over 50 countries. HarvestFresh, a recent acquisition, is a leading grower, packer, processor and distributor of fresh produce to the retail market. Global trends indicate an increasing demand for “ready-to-eat” meals. South Africa has seen giant retailers respond to this through various offerings with the scope and demand increasing. Thebe is responding to this opportunity. Transforming the sector The development of farmers for food security is at the core of Thebe’s strategy. Thebe will partner with key agricultural formations and management companies to develop land owned and managed by emerging farmers and communities, in partnership with the relevant beneficiaries. Existing Thebe investments will be leveraged to provide critical market intelligence to assist farmers to understand market dynamics to compete effectively. Thebe will also explore development funding models for feasible development projects as appropriate. 69 SOUTH AFRICAN BUSINESS 2019

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