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Buying local is essential for master plans to succeed

By Eustace Mashimbye, CEO of Proudly South African.

The poultry industry is an important part of the agricultural sector. The early and modest successes of its master plan are an example of what can be achieved when stakeholders in the public and private sector collaborate for the good of an industry.

The plan, which was signed at the SA Investment Conference in November last year, was developed by the government, poultry producers, processors, exporters, importers and organised labour. Since then, local poultry production has shown moderate growth despite the challenges posed by Covid- 19, increasing by 5 percent during the first eight months of this year com- pared with the same period last year.

The plan hinges on increasing local consumption and growing demand, while addressing the export of cooked and raw chicken products. Poultry producers have pledged R1.7 billion to expand investments and improve production capacity. Some of these projects have been completed, and 428 jobs have been created. In addition to these infrastructure and capacity-building projects, the government has imposed higher tariffs on certain cuts of imported poultry, and it has begun an investigation to create a more effective trade environment for poultry.

The clothing, textile, footwear and leather sector drafted a master plan that was signed by all parties in November last year. The sector was particularly hard hit in the early stages of the lockdown, as retailers were closed. As a result, sales fell 20 percent in the first half of the year, while production declined as much as 30 percent.

The plan is being implemented and, despite early losses, stakeholders are confident of increasing the volume of South African-made clothing for local consumption from about 44 per- cent to 65 percent by 2030. These commitments are expected to add 120 000 jobs across the clothing and textile value chain. Trade, Industry and Competition Minister Ebrahim Patel has been quoted as saying that Covid-19 has made the need for localisation even more urgent and important, and the only way to stimulate local production is by stimulating local demand.

The success of the master plans requires the government, the private sector and individual consumers to commit to procure locally. Buying local has ceased to be a feel-good factor. It is now imperative if we are to get our economy mov- ing. As we ease into the next stage of the lock down, with fewer restrictions and the country’s borders opening up, South Africa may face an avalanche of cheap imported goods as other countries seek to stimulate their economies. The poultry industry is anticipating “a tsunami” of imported frozen chicken. We may also expect imports of cheap clothing. Although it may be tempting to opt for something that is even marginally cheaper than a South African product, we should not be fooled: it will cost the country dearly in the long run if we continue to buy imported products.

In his song “Ungowami”, which loosely translated means “you are mine”, Semito says this country is ours and now, more than ever, we must collectively protect its interests, safeguard that which we already have, and grow its economy so that all of us can reap the rewards.

This article was first published in the Business Report on 30 September 2020.

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