Western Cape’s dominant export remains agricultural products

Agricultural products remain the Western Cape’s dominant export commodity despite the challenges facing the sector, including the prevailing drought in the region.

According to a trade and investment document recently released by Wesgro, the Western Cape’s trade and investment agency, the top exports from the Western Cape in 2016 were refined petroleum oils, citrus fruit, wines, fresh apples, pears and quinces, as well as grapes. The top destination market for citrus fruit (R1,8bn) and grapes (R2,1bn) was the Netherlands, the European Union (EU) distribution hub.

The Western Cape produces more than 50% of SA’s agricultural exports, with the EU being one of the biggest export destinations. The region also accounts for almost 75% of annual offshore wine sales, worth R5bn.

The document highlights that the province experienced an annual average export growth of 17,8% between 2012 and 2016. Exports from the province totalled R121bn in 2016, an increase of 3,8% from 2015. This growth was largely due to the depreciating rand and an increase in competitiveness from Western Cape exporters, the document states.

The top three export destinations for the Western Cape were Namibia (R12,27bn), the UK (R9,17bn) and the US (R8,98bn), accounting for almost a quarter of total exports. Wesgro says the traditional export markets, such as the UK, the Netherlands, and the US are important to the Western Cape economy and are strong drivers for exports. All three saw double-digit growth from 2012 to 2016, with exports to the US growing 23% per annum.

The Western Cape is the second largest province in terms of total trade flows, reaching R313,23bn in 2016, Gauteng is the largest, with R1,28 trillion, and KwaZulu-Natal is third with R243,37bn.

The Wesgro document also notes that between 2006 to 2016 a total of 301 foreign direct investment projects were recorded in the Western Cape, representing a total capital investment of R87bn. In terms of capital expenditure, the largest sectors attracting investment were natural gas, renewable energy, communications, and real estate, which accounted for a combined 53% of all inward foreign direct investment. Companies have established a number of manufacturing facilities in the province ranging from photo-voltaic manufacturing facilities, gas to liquid plants, and wind farms.

“These figures indicate a serious vote of confidence in the Western Cape as a trade and investment destination, and are testament to the work Wesgro has done to promote our region as a business hub for Africa,” said Wesgro CEO, Tim Harris.

Source: AgriOrbit