South Africa’s export farmers could take advantage of new demand from China on the back of increased household savings. But they’ll need to be quick off the mark
Any economist worth their salt has a favourite chart. The economics gurus who have delved into the phenomena behind some deceptively simple line appreciate just how much it means.It certainly struck a chord with the Centre for African Management & Markets team when we spotted it as the opening graph in the latest AgriTrends report from Absa.
There is one obvious short-term solution to this problem: leverage someone else’s diligent saving practices — like China’s.Absa’s chart shows an important finding: lockdown seems to have sparked a surge in household saving in China. “Excess savings in China have amounted to $2.5-trillion during Covid,” say the report authors.Taken together, these findings offer are a potent guideline for South Africa’s exporting farmers.
“As this study shows, China has taken record quick time to become the world’s largest agricultural importer. Our minor contribution to this story is that we export considerable quantities of things like red meat, table grapes, nuts, beef and citrus to them. But don’t get despondent. We can win at this game too.”
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