NEWS
Agbiz Outlook 2019
– Be ready!
If there is one thing we’ve learnt from Agbiz Outlook 2019, it is that we
need to be ready for anything, according to Agbiz CEO John Purchase,
when he spoke about the outlook for 2019 and beyond.
By Aubrey Kruger
Senwes Scenario Editor
H
e mentioned that “things are
definitely changing, but how
they are going to pan out we
do not know.” He especially
referred to China and the US and how
everything will evolve. What was clear is
that China and Russia want to make an
impact and countries like England, Japan,
etcetera were becoming more forceful in
Africa.
Religious fundamentalism is still an
issue and Africa is prone to it, as it hap-
pens even in South Africa and in Northern
Mozambique. These issues “disrupt the
good order”. Another issue to be resolved
is Brexit and the EU with major uncer-
tainties: “Britain’s GDP will drop, there is
no doubt about that. But it does present
certain opportunities for South Africa and
the agricultural sector.” On the other side
of the Atlantic is “the US
President Donald Trump’s
dynamics - the way in which
he does business and per-
forms his functions is very different. He
has basically rewritten the rulebook.” Great
uncertainty is manifesting itself around the
world and South Africa is one of the coun-
tries with more certainty. His advice is to
create a more predictable environment.
THE INTERNET OF THINGS
“The internet is still driving globalisation,
which is not going to change.” One thing
that will change globally is mass migrations
and the humanitarian disasters posed by
it. It will impact agriculture and the food
system. On top of this, environmental sus-
tainability statistics don’t make for good
reading and we are definitely not turning
the environment and global warming
around. “We are seeing changing weather
patterns in South Africa and it will impact
agriculture, that you can be sure of.”
GLOBAL POPULATION
Did you know? 36% of the world’s popu-
lation resides in India and China. Africa
will reach the 1 billion population mark in
2050. “Point being, we need to get sys-
tems in place to feed people, otherwise
we are going to leave a bad legacy in
Agbiz CEO, Dr John Purchase, received the Order
of Agricultural Merit (Mérite Agricole) from the
Ambassador of France, Christophe Farnaud, on 5
December 2018. The Order of Agricultural Merit is
bestowed by the French Republic for outstanding
contribution towards agriculture. He thanked
Purchase and added: “It also resembles recognition
of his exceptional career in the agri-industry.” He
also emphasised Purchase’s involvement between the two
great agricultural powers of France and South Africa.
10
SENWES SCENARIO | MIND-SHIFT 2019
Africa.” This whole dynamic can be either
a massive opportunity or a massive risk.
POLITICS
“You can’t separate politics and the econo
my.” The ANC is still in turmoil and the
DA and EFF are no longer viable ruling
coalitions with many problems of their
own. Current estimates regarding the 2019
national elections are that the ANC will
lose ground to approximately 55%, the DA
will stay in the 22-23% region with the EFF
being a big gainer (16%), but this could
change as we move closer to the elections.
Political uncertainty is not good for the
economy as it detracts investors. One
important fact is that the GDP in rand terms
masks the effects whereas in dollar terms
during the Zuma administration, the GDP
moved from $8 000 to $5 200 per capita.
This means that South Africans are more
than 25% poorer - “The poor gets affected
the worst. It is a real nightmare. But now
we have to turn it around.” On top of it all
the government fiscus is under pressure,
battling to pay bloated public service
and funding state owned enterprises. The
effect of the fiscal framework expenditure
and VAT budget balance amounts to a
full percent deficit on budgets for the next
four years – “So, South Africa pays more to
service its debt, but basically we have no
choice but to keep serving the population.”
He finished by saying enough is
enough. We’ve got to get government to
perform regulatory functions and be pro-
active to get the economy going and drive
things to ensure investment growth.