What Is Agribusiness Trade In South Africa?

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Available data on African trade have been, to a large extent, incomplete and controversial. To be sure, there have been no-full proof data on agribusiness trade finance growth and options for most African countries including South Africa. Most of the available statistics are often misleading (Bezruchka 284). In spite of this anomaly, an evaluation of publications that focus on global trade and well-scrutinized financial statements of various African banks shows that agribusiness trade finance has been gradually available and increasingly affordable amidst the recent economic-crisis phase between 2000 and 2008B (Passikof 17). For instance, a report by Ecobank shows $92 million in contingent liabilities relating to clean-line letters of agribusiness credit at the end of 2003 and $302 million at the end of 2007. Although the figures may not be accurately comparable because of the establishment of the bank’s network, they are congruent to the numbers reported by other international financial organizations (World Bank 21). More importantly, senior product managers of various banks such as Standard Chartered Bank reported that agribusiness finance had matured dramatically in South Africa between 2004 and 2007 (Jaffee 30). Just as important, too, various trade-finance specializing media organizations repeatedly featured reports that highlighted critical transactions showing an increase in the demand, transaction volumes and emerging borrowers in the country’s agribusiness market (Mataen 23). However, agribusiness trade performance in South Africa, just like in many African countries, has been affected more negatively than most other world regions. Although the direct effect of this challenge may be insignificant because of the relative i... ... middle of paper ... ...ion sharing and reduce land conflicts (World Bank 17). Today, many international finance institutions and private organizations partner with public sectors for improved agricultural production and increased markets. Specifically, private food processing companies are now driving the agro-food industry in South Africa to a large extent (Jaffee 44). Because of the higher probabilities associated with post-harvest losses in South Africa, these companies have been crucial in converting primary agricultural produce into products of consumption (Mataen 26). Conceivable, these agro-food processing companies now include multinational corporations and small-scale processors (Bezruchka 285). In the end, it seems, the South African government has recognized the importance of export and investment promotion protocols as contributors to sustainable enterprising and agribusiness.

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