Namibia: Lack of Value Addition Scuppers Table Grape Returns

NAMIBIA last year exported table grapes to five European countries, generating N$682,4 million in income, while South Africa's wine exports to the same countries generated N$5,5 billion.

This confirms that value addition matters when it comes to trading, as opposed to volume only.

This comes as the industrialisation of Namibia seems to be on ice, while the news of the Special Economic Zone has faded, and some manufacturing incentives have been cancelled.

Namibia and South Africa share around five European customers - the United Kingdom (UK), the Netherlands, Denmark, Germany, and Belgium - yet generate different incomes from these customers, which is mainly due to South Africa's wine production.

Namibia, on the other hand, harvests table grapes, packs and ships them out, with the only value addition involving raisins.

As result, the country has generated N$834,9 million in fresh and dried grape exports in 2020 - a slight decline from 2019's exports worth N$840,7 million, the Namibia Statistics Agency (NSA) has indicated.

This income includes the exporting of 37,2 million kg of fresh and dry grapes in 2020, and 33,9 million kg in 2019.

Most of these grapes have been exported to the Netherlands, followed by the UK, Germany, Belgium, and Denmark.

According to Michelangelo Magazine's May 2021 edition, South Africa exported 212,4 million l of wine to the same European countries as well as to Sweden in 2020.

This generated N$5,5 billion for the country.

Michelangelo is one of the largest wine and spirits competition sponsors in Africa.

According to the magazine's data, the UK imports 82,3 million litres of wine from South Africa annually.

NSA data shows the UK and the Netherlands were the biggest importers of Namibia's fresh grapes in 2019 and 2020.

The two countries individually procured more than 230 000 kg in 2019, and more than 260 000 kg last year.

Even though Namibia is not adding value to its grapes, they are exported to more than 30 countries around the world - not only to Europe, NSA data indicates.

The grape sector may be the only one exporting to more than 30 countries around the world, followed by the fishing and beef sectors.

Namibian grapes are also exported to the rest of the continent to countries such as Nigeria, Angola, and Kenya.

According to the Agriculture Union of Namibia, the grape sector performed well last year, with an estimated production value of about N$1,1 billion.

This is a 39,6% increase compared to 2019 and 2020's production values.

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