Namibia's exporting jobs
The lack of value addition as well as our reliance on imports is exporting real and tangible jobs creating work outside the borders of the country while we combat unemployment.
Namibia is exporting local job opportunities within the agricultural sector by allowing value addition to take place outside the country.
Furthermore, the country, because it cannot produce enough food for its own needs, relies on imports to make up on the shortfall which leaves us exposed to food insecurity.
This is according to Paul Smit, a former deputy agricultural minister during the recently held Bank of Namibia's symposium 'Feeding Namibia: Agricultural Productivity and Industrialisation'.
Smit gave an overview of the country's current status of agricultural productivity and industrialisation.
He said meat produced in the country is mainly exported in its primary state, implying a loss of local job creation in the form of value addition.
“About 80% of local production is either exported as primary beef cuts, lamb carcasses and live exports on the hoof. This implies that a lot of secondary and tertiary value addition in the meat sector takes place outside Namibia. This equates to exporting local jobs, while the dividends of value addition are not repatriated back to the country and to livestock producers,” he said.
Smit said apart from the livestock sector, all the other sectors within the agricultural industry are deficit producers and rely on imports to satisfy the local demand.
He is of the view that production will continue to dominate agricultural production, while chicken production still falls short of local consumption.
“Poor marketing, the small size of the domestic market, and the inability to add processing value and penetrate foreign markets, all act as constraints to agricultural development.”
According to Smit, agriculture is an important sector not only in the context of food security, but also in terms of economic development in general.
“In terms of food security, while the livestock industry is relatively developed, the horticulture, and poultry sectors need to be developed.
“Livestock produce is mainly exported, while horticulture and poultry still lag behind in terms of meeting local demand.”
About 70% of the Namibian population depends on agriculture for all or part of their livelihoods, with 40% smallholder farmers growing grain crops mainly for their own consumption.
The high reliance on imports for agricultural produce leaves Namibia exposed to external price increases, said Smit. Namibia only produces about 40% of the food it consumes and is highly dependent on imports.
“The country is therefore forced to import about 60% of its food requirements, which leaves it vulnerable to external price increases, with the poor having less ability to absorb such fluctuations.”
Exports of livestock and crops were valued at N$1.7 billion in 2016, accounting for 2.8% of total export receipts.
Smit added that horticultural produce plays an increasingly important role in exports and hence the government has identified about 27 000 hectares of potential irrigable land of which about 11 000 hectares is under production. Between 2003 and 2008, the overall value of game meat exports almost tripled, from less than N$11 million to N$31 million. In terms of volumes, South Africa remained Namibia's principal venison trading partner.
Since 2014 however, there has been no facility exporting meat from game species to overseas markets, and export activities have been largely confined to small amounts of processed products (biltong and droëwors) going to South Africa, with meat export quantities plummeting to 86 tonnes in 2014 and 38 tonnes in 2015.
Furthermore, with the introduction of venison for the health-conscious consumer seeking leaner meat and a more favourable fatty acid composition, traditional livestock farming is under threat of being replaced. The oversupply of game meat, especially during the hunting season, sees farmers losing out on business, as venison is relatively cheaper than beef.
Recent data indicates that agriculture in Namibia occupies 64 million hectares or 78% of the land area, including 206 000 households and 1.17 million people. However, less than 2% of the total land area is arable because rainfall is limited. Only 40 000 hectares are suitable for intensive agriculture, and the country suffers from drought six out of every 10 years.
In 2016, the agro-processing sector (food products, beverages, leather and related products) contributed approximately 5% to the GDP. Namibia is a net exporter of unprocessed agro-products, especially from the livestock sub-sector.
The meat and processing industry showed declining growth in recent years, mainly attributed to the drought conditions. In terms of value addition, meat and meat processing grew on average by 0.48% between 2007 and 2016.
“Stagnant contribution to GDP can be seen from the period between 2014 to 2016 with a growth rate of 0.4%. This was caused mainly by the severe drought conditions experienced during this period.”
He says the sector continues to face significant challenges. These include persistent droughts, high input costs, lack of interest from local retailers to stock local products, and a lack of adequate storage facilities.
According to Smit, the agro-processing industry has been identified as a key sector for creating jobs and spurring growth owing to its strong linkages with primary agriculture.
However, the inability to add processing value and penetrate foreign markets act as constraints to agricultural development. Growth prospects in the agro-processing industry are evident, as seen from its export figures, especially in the meat and fishing industries.
Rapid growth in the manufacturing and export services, therefore, can only occur when the agricultural sector's productivity improves significantly, Smit said.
ELLANIE SMIT
Furthermore, the country, because it cannot produce enough food for its own needs, relies on imports to make up on the shortfall which leaves us exposed to food insecurity.
This is according to Paul Smit, a former deputy agricultural minister during the recently held Bank of Namibia's symposium 'Feeding Namibia: Agricultural Productivity and Industrialisation'.
Smit gave an overview of the country's current status of agricultural productivity and industrialisation.
He said meat produced in the country is mainly exported in its primary state, implying a loss of local job creation in the form of value addition.
“About 80% of local production is either exported as primary beef cuts, lamb carcasses and live exports on the hoof. This implies that a lot of secondary and tertiary value addition in the meat sector takes place outside Namibia. This equates to exporting local jobs, while the dividends of value addition are not repatriated back to the country and to livestock producers,” he said.
Smit said apart from the livestock sector, all the other sectors within the agricultural industry are deficit producers and rely on imports to satisfy the local demand.
He is of the view that production will continue to dominate agricultural production, while chicken production still falls short of local consumption.
“Poor marketing, the small size of the domestic market, and the inability to add processing value and penetrate foreign markets, all act as constraints to agricultural development.”
According to Smit, agriculture is an important sector not only in the context of food security, but also in terms of economic development in general.
“In terms of food security, while the livestock industry is relatively developed, the horticulture, and poultry sectors need to be developed.
“Livestock produce is mainly exported, while horticulture and poultry still lag behind in terms of meeting local demand.”
About 70% of the Namibian population depends on agriculture for all or part of their livelihoods, with 40% smallholder farmers growing grain crops mainly for their own consumption.
The high reliance on imports for agricultural produce leaves Namibia exposed to external price increases, said Smit. Namibia only produces about 40% of the food it consumes and is highly dependent on imports.
“The country is therefore forced to import about 60% of its food requirements, which leaves it vulnerable to external price increases, with the poor having less ability to absorb such fluctuations.”
Exports of livestock and crops were valued at N$1.7 billion in 2016, accounting for 2.8% of total export receipts.
Smit added that horticultural produce plays an increasingly important role in exports and hence the government has identified about 27 000 hectares of potential irrigable land of which about 11 000 hectares is under production. Between 2003 and 2008, the overall value of game meat exports almost tripled, from less than N$11 million to N$31 million. In terms of volumes, South Africa remained Namibia's principal venison trading partner.
Since 2014 however, there has been no facility exporting meat from game species to overseas markets, and export activities have been largely confined to small amounts of processed products (biltong and droëwors) going to South Africa, with meat export quantities plummeting to 86 tonnes in 2014 and 38 tonnes in 2015.
Furthermore, with the introduction of venison for the health-conscious consumer seeking leaner meat and a more favourable fatty acid composition, traditional livestock farming is under threat of being replaced. The oversupply of game meat, especially during the hunting season, sees farmers losing out on business, as venison is relatively cheaper than beef.
Recent data indicates that agriculture in Namibia occupies 64 million hectares or 78% of the land area, including 206 000 households and 1.17 million people. However, less than 2% of the total land area is arable because rainfall is limited. Only 40 000 hectares are suitable for intensive agriculture, and the country suffers from drought six out of every 10 years.
In 2016, the agro-processing sector (food products, beverages, leather and related products) contributed approximately 5% to the GDP. Namibia is a net exporter of unprocessed agro-products, especially from the livestock sub-sector.
The meat and processing industry showed declining growth in recent years, mainly attributed to the drought conditions. In terms of value addition, meat and meat processing grew on average by 0.48% between 2007 and 2016.
“Stagnant contribution to GDP can be seen from the period between 2014 to 2016 with a growth rate of 0.4%. This was caused mainly by the severe drought conditions experienced during this period.”
He says the sector continues to face significant challenges. These include persistent droughts, high input costs, lack of interest from local retailers to stock local products, and a lack of adequate storage facilities.
According to Smit, the agro-processing industry has been identified as a key sector for creating jobs and spurring growth owing to its strong linkages with primary agriculture.
However, the inability to add processing value and penetrate foreign markets act as constraints to agricultural development. Growth prospects in the agro-processing industry are evident, as seen from its export figures, especially in the meat and fishing industries.
Rapid growth in the manufacturing and export services, therefore, can only occur when the agricultural sector's productivity improves significantly, Smit said.
ELLANIE SMIT
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