Regional Value Chains : Exploring Linkages and Opportunities in the Agro-Processing Sector Across Five SADC Countries

This paper evaluates the potential for developing regional value chains in the agro-processing sector across five SADC countries; South Africa, Mozambique, Zambia, Tanzania and Mauritius. Countries in SADC spend a considerable amount on processed food imports, which is expected to grow as incomes rise and rapid urbanization continues. Many economies remain oriented to primary agricultural production and the export of a few cash crops while, overall, there is a trade deficit in food for the continent as a whole. Developing agro-processing value chains is thus at the heart of meeting the growing regional demand for processed food products and to advance industrialisation. Approaching food as an industrialisation question also acknowledges the linked investments required in transport and logistics, research and development, packaging and standards to grow the agro-processing sector and which have positive spill-overs for the rest of the economy. This paper also argues that regional agroprocessing value chains are even more important in the context of climate change which will place greater pressure on food production, with differing impacts across countries. Climate change introduces new levels of uncertainty about what crops can be produced and where these can be produced sustainably. This variability suggests that we need to consider how investments should be made across the region to organise production in a way that anticipates these changes and makes the most sustainable use of endowments and capabilities across countries. A narrow national view of industrialisation ignores the benefits of scale and endowments associated with regional markets that could support mutually beneficial joint industrialisation across SADC