Despite a range of challenges – from the coronavirus to a threatening downgrade – exporters in the Eastern Cape have experienced growth in the agricultural and automotive sectors over the past year.
During the Exporters Eastern Cape Export Growth Panel Discussion hosted on Wednesday, 4 March 2020 at Radisson Blu Hotel in Port Elizabeth, panellists shared the encouraging sentiment that, despite the recessionary climate in South Africa and other global challenges, they remained resilient and experienced growth.
In fact, Thomas Schaefer, Managing Director of Volkswagen Group South Africa (VWSA), said Volkswagen in South Africa had achieved its best year since 1951.
“VWSA had the best year of its existence, really. In terms of production numbers, the highest number we ever produced was achieved. We also achieved amazing market share – I think it’s the third highest market share ever achieved in the country, so we are very happy. The results are great, and we are pushing further for this year, which probably is going to be challenging but we look at it as an opportunity,” said Schaefer.
Schaefer also said there was unbelievable opportunities in Africa and that many African countries were ahead of South Africa in terms of infrastructure and political will. He stressed the importance of creating a regional market for the automotive industry in Africa.
Hannes De Waal, Managing Director of Sundays River Citrus Company, said the South African fruit industry in the last decade had also grown in leaps and bounds, despite the recent drought, climate change and other challenges.
“This is all thanks to new market access opening up in Asia and Eastern Europe. In 2009 the South African citrus industry exported 85 million cartons. Now we are on 130 million and if it wasn’t for the drought, we would have been on a 150 million cartons.”
“We have had wonderful growth in the last decade, there is still opportunities and markets which we can penetrate more. We are quite confident that the growth we see will continue. Our industry is really well position as far as export throughout the globe goes, so we are very positive about it,” said De Waal.
De Waal added that the local citrus industry was not significantly impacted by the coronavirus to date, however, rather than panicking most industries are asking suppliers to do risk assessment.
Paul Lynch, Director of South African Wool & Mohair Buyers’ Association (SAWAMBA), said the coronavirus had also not impacted the wool industry despite its biggest markets being in the East.
“Between 75% to 80% of South Africa’s wool gets exported to China, and we are still waiting to see if prices will drop. At the moment, however, there is rather an increase in the price of wool. We are also fortunate that there are other markets that can absorb our wool, including the Czechoslovakia Republic,” said Lynch.
Lynch said even during the recent challenging times of the Foot-and-mouth-disease outbreak, when South Africa could not export certain animals and animal-products for several months, the wool market dropped only marginally. “We worked on diversifying the market and got through it, due to our strong client relationships,” said Lynch.
Lauren Goddard, Regional Country Sales Manager of Expeditors International, said in the logistics and freight forwarding sector shipments continue to flow and get out of the harbours despite the coronavirus, and many factories are starting up again in China.
“However, we are experiencing port congestion, and capacity has been challenged, particularly in getting containers out of export depots. There is about two- to three-week delays of raw materials. Due to the knock-on effect with port congestion and the bottleneck in China, we need to think ahead on how this will affect our supply chain,” said Goddard.
Panel Discussion facilitator and Exporters Eastern Cape Vice-Chair Jane Stevenson in summary said Eastern Cape Exporters welcomed the fact that the region’s leading exporters remained resilient despite challenging market conditions. She attributed this to several shared growth strategies including collaborative partnerships, understanding cost margins and constantly looking for new markets.