SA's Carbon Tax

UPDATE: SA’s Carbon Tax & Offsetting Developments

Since the Draft Carbon Tax Bill was released in November 2015 (see our carbon tax news item  of 11 April 2016), National Treasury has held various stakeholder engagements. Although various issues are now clearer, a number of issues are still being finalised. The next draft Carbon Tax Bill is expected by late August or September this year.  Herewith an update since our last carbon tax news item. Read more

Brexit: South African Agriculture

SA’s Agri Exports: Understanding Brexit

On the 24th of June, 2016, David Cameron announced the surprising results of the UK’s Brexit referendum – the scales were tipped towards leaving the EU, sending global markets into turmoil. The GBP dropped to a 31-year low against the USD, and USD2 trillion were wiped off global markets. The rand slipped by 8% against the USD (1,2). Beyond these initial exchange rate and market shocks, there are obviously further significant deeper social, political, and economic implications for the UK and the EU. But as the dust is settling, and the markets begin to recover, what are the potential impacts to South Africa’s future trade relations, especially those relating to agriculture?

4% of South Africa’s total exports are destined for the UK, and this comprises roughly 20% of South Africa’s total exports to the EU (3). Obviously these export figures are far more heavily weighted in some industries than others, this being particularly true for agriculture – in 2014, the UK was South Africa’s third largest export destination for agricultural products (4). Roughly 30% of South Africa’s fruit exports were destined for the UK over the 2013/2014 season. Table 1 shows the component of total exports to the UK and the EU for each major group of fruit. The story is similar for South Africa’s wine exports to the UK, where, in 2013, 25% of South Africa’s wine exports were destined to the UK (5). Obviously these percentage components will fluctuate year-to-year with commodity prices.

Brexit: South African Agriculture

Table 1: Exports to the UK and the EU, based on the 2013/2014 season

 

 

 

 

The immediate Brexit implications for South Africa’s agricultural exports relate to exchange rate fluctuations – to date, while the rand has weakened against the dollar, it has strengthened against the GBP, decreasing the competitiveness of exports. But potential longer term impacts to agricultural exports relate to trade agreements. South Africa currently exports to the UK under the recently signed EU-SADC Economic Partnership Agreement. Once the UK leaves the EU, South Africa will no longer have access to the UK market through the EU, and new trade agreements and tariffs will need to be negotiated directly with the UK, leaving room for uncertainty (6).

But these changes will only take effect once the UK actually leaves the UK, a process expected to take at least two years (7). While this requires us to have faith in SA’s negotiating powers, it is not cause for immediate concern.

 

 

References

  1. Business live. Brexit panic wipes $2 trillion off world markets – as it happened [Internet]. The Guardian. 2016 [cited 2016 Jul 11]. Available from: https://www.theguardian.com/business/live/2016/jun/24/global-markets-ftse-pound-uk-leave-eu-brexit-live-updates
  2. Potelwa X. Brexit spells bad news for SA: Rand falls most against the dollar since 2008 as UK votes to leave the EU [Internet]. Mail and Guardian. 2016 [cited 2016 Jul 11]. Available from: http://mg.co.za/article/2016-06-24-rand-falls-most-since-2008-as-uk-votes-for-brexit
  3. van Rensburg D. How Brexit may affect SA economy [Internet]. City Press. 2016 [cited 2016 Jul 11]. Available from: http://city-press.news24.com/Business/how-brexit-may-affect-sa-economy-20160626
  4. DAFF. Economic Review of the South African Agriculture. 2014.
  5. Analytix. South African Wine Exports Analysis. 2014.
  6. Mchunu S. Brexit would impact SA’s agricultural sector [Internet]. Business News. 2016 [cited 2016 Jul 11]. Available from: http://www.iol.co.za/business/news/brexit-would-impact-sas-agricultural-sector-2037069
  7. Pearson M. UK votes “Leave”: Why it will take at least 2 years to exit the EU [Internet]. CNN. [cited 2016 Jul 12]. Available from: http://edition.cnn.com/2016/06/24/europe/brexit-steps-to-leave-eu/
Water Footprint

Water Footprint: Stone Fruit Project

In my post in April this year, I outlined the two different Water Footprint guidance standards, and explained the blue, green and grey water footprint components. Based on the Water Footprint Network’s (WFN) guidance standard, we developed a data collection and calculation tool in order to streamline the water footprint assessment process. These were piloted through a study on stone fruit production with Stems Fruit – an interesting learning process for both Blue North and Stems Fruit.

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Agroecology

What is at the heart of every business?

At the center of the Blue North System Map (see below) is the large dark blue arrow running from left to right – it is the cornerstone of our approach to understanding sustainability and making it relevant for businesses. In this post I will examine this element of our system map, how it can be used to derive a meaningful objective for a business’s sustainability strategy and examine how this changes the business’s strategic views of the environment in particular.

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Sustainable Agriculture, diversification and trade-offs

Sustainable agriculture, diversification and trade-offs

There is general consensus that agriculture can meet the expected future food needs of a growing population, however the grand question is how we achieve this by sustainable means?

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South Africa’s water – where are we?

Water is arguably South Africa’s most vital and precious natural resource. It is integral to the survival of human life, the functioning of ecological systems, food and energy production, transportation, waste disposal, and industrial development (1–4). But as human populations grow, consumption patterns change, and economies develop, the pressures on natural water resources continue to increase.

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What’s in a water footprint?

Freshwater resources – the increasing demand for, and increasing uncertainty of availability, have given rise to strong questions around water risks across agricultural value chains. The concept of water footprinting provides an effective platform from which to address and discuss these questions.

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GIS Water Risk Assessment Tool

Blue North Sustainability was engaged by a UK importer to develop a GIS-based water risk assessment tool. The main purpose of the tool is to provide a better understanding of the potential water risks faced by South African fruit farmers within their supply chain.

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COP21 Oil Refinery - Is it Enough

SA’s Carbon Tax and the Implications for Fruit and Wine Farmers

The Draft Carbon Tax Bill was released for comment during November 2015.  The Confronting Climate Change (CCC) Initiative has received many questions with regards to the bill and has, in response, developed this summary document based on the information at our disposal at the time of writing.  Read more

Confronting Climate Change

Confronting Climate Change: Project Update

Blue North manages the “Confronting Climate Change” project (or CCC in short) on behalf of the South African Fruit and Wine industries. This project is now in its 8th year and focuses on supporting South African farmers, packhouses and wineries in calculating their carbon footprint.  Here is a short and sharp update of what 2016 holds in store:

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