Drought impact on W Cape economy worse than anticipated - minister
Cape Town - Compared to the previous season, aggregate income after costs in the agriculture sector in the Western Cape is estimated to have declined by up to R5.9bn. This is due to the lower output as a result of the drought.
The impact of the drought on the Western Cape economy cannot be sugar coated and is actually higher than previously anticipated, Western Cape minister of economic opportunities Alan Winde said at a media briefing on Thursday.
"We need the drought to be declared a national disaster and an allocation from the new Cabinet for infrastructure investment in our dams - like Brandvlei and Clanwilliam," said Winde.
"We will continue to invest in smart agriculture. Research is very important. A whole new water economy will come out of this [crisis] and we need to use lots of innovation in agriculture to ensure that the crisis enables us to remain competitive. You cannot compete if you have no products to compete with."
Agriculture and agri-processing contribute a combined R54bn to the provincial gross value added - a measure of all the goods and services produced by a sector. Of all the province’s exports, 52% comes from the agriculture and agri-processing sectors.
Research indicates that about 30 000 jobs will be lost in the province due to the drought. According to Louw Pienaar, an agricultural economist at the Western Cape Department of Agriculture, about 22% of rural jobs in the province relate to agriculture. Many of these jobs are for unskilled or semi-skilled workers. This means these workers will not easily be absorbed by the rest of the economy if they lose their jobs in agriculture.
Pienaar estimates that it will take between eight to ten years for agriculture in the province to recover from the impact of the drought.
source: Fin24
Link: https://www.fin24.com/Economy/drought-impact-on-w-cape-economy-worse-than-anticipated-minister-20180301