Sugar crisis: President Ramaphosa must put government’s money where its mouth is on localisation
9 February 2022
In his 2021 State of the Nation Address, President Cyril Ramaphosa encouraged the South African government, business, and organized labour to buy local. While the private sector including Proudly South African and the Shoprite Group have taken up the mantle when it comes to supporting the local sugar industry, government appears to be lagging behind. In this year’s address, it is vital that the President announces action on government’s commitments under the South African Sugarcane Value Chain Masterplan including government departments and state entities only procuring locally produced sugar.
Last year’s call to buy local came as part of the President’s announcement of the priority actions government would take to restore growth in the South African economy and create jobs. The President’s second priority was to support a massive increase in local production as part of a localisation drive.
SA Canegrowers shares the President’s concern for economic recovery, growth, and job creation, and we believe in the potential of the Sugarcane Value Chain Masterplan to produce these results. But if it is to succeed, we need action from all signatories of the Masterplan.
Action commitment one of the Masterplan aims to address the threat of imports to the economy and jobs by committing industry stakeholders to act to restore an initial 150,000 tons of sugar demand to the local sugar industry in the first year, with the goal of increasing this to 300,000 tons in the third year. To achieve this, the Masterplan calls on retailers, wholesalers, and industrial users to procure 80% of their sugar locally, with this amount rising to 95% in the third year, and it requires that Government promote the use of local sugar by all its departments and state-owned entities.
For its part, SA Canegrowers launched its Home Sweet Home campaign in December 2020 to encourage consumers to buy locally produced sugar. Encouragingly, both Proudly SA and the Shoprite Group have joined as partners of the campaign over the past year. This has included the Shoprite Group prioritising the procurement of locally produced sugar to sell to their customers and introducing Home Sweet Home promotional material in sugar aisles in their Shoprite and Checkers stores across the country.
The support from South African consumers has also been heartening. We are pleased to report that the industry has exceeded the one-year target of restoring 150,000 tons of sugar demand. The first year of the Masterplan’s implementation saw more than 200,000 tons of sugar demand restored.
Now it is time to set our sights on the attainment of the three-year target. But to do this, the President must ensure that government honours its commitments too.
The recovery of the sugar industry is crucial for the economy in general, but also particularly for rural communities in KwaZulu Natal and Mpumalanga, where it is a crucial source of employment. The industry has more than 22,000 growers, of which 21,581 are small-scale growers, who directly employ more than 65,000 workers and create 270,000 indirect jobs.
In total, more than one million livelihoods depend on the sugar industry. In the aftermath of the economic devastation caused by the Covid-19 pandemic and the unrest in July 2021, it is more important than ever that we preserve these vital livelihoods.
SA Canegrowers is committed to working with all stakeholders to ensure that the industry not only survives but grows and creates more opportunities for the next generation of canegrowers. With support from the President, and action from government, we are confident that we will succeed in protecting the one million South African livelihoods that the industry supports.
Issued by Kabelo Kgobisa, 9 February 2022
