The full extent of the damages caused to the wine industry by the harsh, unduly prolonged lockdown regulations of the national government is now emerging. During the Level 5 lockdown ban on exports alone, wine exporters lost an estimated amount of 80 million litres in sales. It has now emerged that exports of wine declined by almost 40% over the past six years.
Domestic wine sales also decreased by 40% in 2020 and, in total, this equated to approximately 300 million litres of uncontracted bulk inventory by the first half of the year.
It is important to note that whilst these measures have adversely affected the Cape wine industry, it is not the sole cause of its decline. According to a Business Day article, total exports have declined from a peak level of 525 million litres in 2013 to 319 million litres in 2019. Judging by the lack of support for agriculture, including the wine industry, by the central government, this comes as no surprise. The Western Cape provincial government, under the leadership of Premier Alan Winde has from the onset spoken out against the prolonged hard lockdown regulations and emphasised the importance of jobs and the preservation of livelihoods.
I believe, with the right interventions and a supporting government, that the wine industry can contribute immensely to the desperately needed job creation and post-Covid-19 economic recovery.
As Chairperson of the Agriculture Standing Committee in the province, I will therefore:
- Submit parliamentary questions to the provincial government enquiring about the measures and policies, if any, that are being developed by all government spheres to support this keystone industry, and
- Invite relevant wine industry bodies and the provincial department to brief the committee on the magnitude of this issue and ways in which the current concerns can be addressed.
I call on the national government, particularly the Minister for Cooperative Governance and Traditional Affairs, Dr Nkosazana Dlamini-Zuma, to urgently liaise with the wine industry in order to develop smarter and less damaging measures for future Covid-19 regulations.
The decline in exports and domestic consumption worsens the prevailing economic conditions that were being felt prior to the pandemic. Especially during the time of stringent lockdown measures, the Covid-19 National Command Council has displayed itself tone deaf to problems facing the industry and, by extension, the economy. Owing to that, South Africa has experienced one of the most severe depressions in recent history. It has resulted in immense unemployment.
Although it is very late to the game, it is critical that government liaises with wine producers regarding policy and initiatives which can be used to ensure stability and productivity in the long term. Without this, we are likely to see further job losses in the industry and those which support it.
