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13 September 2023 | Story Samkelo Fetile | Photo Supplied
Agriculture Supply Chain - Ukraine
On Thursday 7 September 2023, the University of the Free State (UFS) presented its fifth webinar titled, The need for a global and regional plan/approach to respond to the consequences of the Russia-Ukraine war, as part of the 2023 Thought-Leader Webinar Series.

Africa must avoid being instrumentalised by external conflict

In the wake of Russia's invasion of Ukraine, the world has been grappling with the far-reaching consequences of this conflict. The effects can be felt globally – affecting economies, supply chains, and vital issues on the international agenda. These are some of the points discussed in the recent Thought-Leader webinar held by the University of the Free State (UFS). The webinar titled, The need for a global and regional plan/approach to respond to the consequences of the Russia-Ukraine war, brought together experts such as Wandile Sihlobo, Chief Economist at the Agricultural Business Chamber of South Africa; Elizabeth Sidiropoulos, Chief Executive of the South African Institute of International Affairs; Dr Jakkie Cilliers, Chairperson of the Institute for Security Studies; and Prof Philippe Burger, Dean of the Faculty of Economic and Management Sciences, UFS.

The webinar was facilitated by Prof Francis Petersen, Vice-Chancellor and Principal of the UFS.

Exploring Africa’s long-term future

Dr Cilliers delved into the long-term future of Africa; drawing comprehensive insights, his analysis highlighted the global shifts and their impact on the continent. He projected that China would surpass the United States as the world's most powerful country by mid-century, emphasising the need for Africa to navigate relations with both China, the EU, and the US for its development.

Four global scenarios were presented by Dr Cilliers: a sustainable world, a divided world, a world at war, and a growth world. The most probable scenario appeared to be a divided world, characterised by fragmented international relations and a growing divide between the wealthy West and the rest of the world. He stressed the importance of Africa pursuing geopolitical stability, avoiding being instrumentalised by external conflicts, and working towards a fair, rules-based global system.

He also touched on Russia's influence in Africa, noting its role in proxy wars and coups d'etat aimed at disrupting Western influence. “While Russia's direct presence in Africa was relatively small, its capacity to undermine the West and impact Africa's development prospects was significant,” said Dr Cilliers. He cautioned against overestimating Russia's influence and emphasised the need for a more nuanced understanding of the complex factors affecting Africa's future.

Global paradigm shifts

Sidiropoulos placed the ongoing war and global developments in a broader context, emphasising the need for a significant shift in how we perceive the world and its norms, calling for changes in economics, politics, and even ideology. Regarding the Ukraine conflict, she noted its role as a proxy and European war with far-reaching global consequences, highlighting the importance of understanding its historical context.

She discussed the evolving dynamics of the Ukraine conflict, where neither side has achieved its desired outcomes. She emphasised the potential for war fatigue and the need to consider alternative pathways, such as dialogue and negotiation, to avoid a frozen conflict or an outright victory by one party. She also underscored Russia's continued relevance as a great power with nuclear capabilities, prompting questions about the future of European security arrangements.

Shifting her focus to South Africa and Africa as a whole, Sidiropoulos stressed the importance of understanding the foreign policy of major global players such as Russia, China, and India. “As these countries rise in influence, it becomes essential to navigate their policies, both in terms of national interest and values,” she added.

Nonalignment and South Africa's foreign policy challenges

Sidiropoulos discussed the challenges presented by South Africa’s non-aligned stance. “There is a need for a coherent government-wide strategy, clear messaging, and the ability to make decisions based on issues and national interests rather than being automatically aligned with one camp or another.” The importance of preserving policy space and balancing economic interests with fundamental principles in international relations was emphasised.

She called on African countries to adopt a more proactive stance in shaping their path and ensuring that national interest serves the citizens and society, not just the elite. She stressed the importance of economic independence, not isolation, by leveraging opportunities such as the African Continental Free Trade Area (AfCFTA), diversifying production, and strengthening governance for accountability.

Strengthening regional value chains

Sihlobo emphasised the vulnerability of the continent's food supplies and stressed Africa's dependence on food imports, highlighting that the continent imports approximately $80 billion worth of agricultural food, fibre, and beverage products. “Vulnerabilities in the food supply chain existed before the war due to factors such as drought, conflicts in East Africa, and COVID-19 supply chain disruptions. These vulnerabilities disproportionately affected Africa's poor households,” said Sihlobo.

South Africa, in contrast to much of Africa, exports nearly half of its agricultural production, amounting to around $13 billion in value. Despite exporting record volumes in 2022, South Africa has not escaped the price transmission effects of global disruptions, resulting in food inflation concerns. However, South Africa's situation was relatively better due to its export-oriented agriculture.

Sihlobo emphasised the need for Africa to strengthen regional value chains to insulate itself from external shocks. “Regional cooperation, productivity improvements, infrastructure development, and investments are essential for Africa's agricultural sector to thrive,” he added.

To enhance agricultural productivity in Africa, Sihlobo highlighted the importance of political stability, good governance, and infrastructure development. Productivity gains must replace extensive land expansion, with governments promoting sustainable agricultural practices.

Need for ongoing containment

Prof Burger highlighted the importance of containment as a policy approach to address the ongoing Russia-Ukraine crisis. He emphasised the need to consider the moral, economic, and political dimensions of the crisis, while recognising its historical context.

He noted that the initial invasion of Ukraine led to spikes in global inflation. However, subsequent developments, including a military containment, contributed to a decrease in inflation rates. He likened the current military stalemate to World War I's trench warfare and the lack of significant military progress for protracted periods of time. He also highlighted that the Black Sea Grain Initiative (BSGI) of 2022 has expired, and Russia has shown reluctance to renew it. This ongoing stalemate and the risks associated with the non-renewal of the BSGI have raised questions about the prospects of the crisis.

Prof Burger discussed the concept of containment, differentiating between long-run changes in input prices and short-term fluctuations. “Successful containment involves interventions that prevent price movements from deviating significantly from long-term levels.” He pointed to successful containment interventions during the COVID-19 pandemic and the Russia-Ukraine crisis. These measures included economic stimuli, vaccine distribution, rerouting of grain exports, and ensuring stable energy supply.

He briefly discussed the role of the expanded BRICS (Brazil, Russia, India, China, South Africa), which now includes Saudi Arabia, the UAE, Egypt, Ethiopia, Iran, and Argentina, in the context of the crisis. While acknowledging divisions within the group, he noted that BRICS allows China and India to pursue their international programmes more independently.

Prof Burger concluded by highlighting the need for containment in the face of a long-term military stalemate or the absence of a clear Ukrainian victory. He argued that containment in the form of a long-term ceasefire as in the Kashmir and Korea conflicts might be the most viable solution. In addition, the stability of the Putin regime and Western support for the Zelensky government would be crucial factors in determining the trajectory of the crisis.


WATCH: 2023 UFS Thought-Leader Series

News Archive

Guest lecture: Mr Pretorius, CEO of McCarthy Limited
2004-11-05

The challenges facing business leaders in a rapidly changing South Africa

“The world we used to know does not exist anymore. Leaders are continually dealing with crisis and opportunities, in a high-pressure environment,” said Mr Brand Pretorius, honorary professor from the University of the Free State , delivering his 13th guest lecture on the challenges facing business leaders in a rapidly changing South Africa .

Mr Pretorius, CEO of McCarthy Limited, identified certain trends which are responsible for changes to the South African business environment. He said the South African business environment is ever-changing, fast moving, complex and unpredictable. “As business people we have to deal with the impact,” he said.

“Years ago we were globally isolated. Now we live in a shrinking borderless world with crumbling trade barriers. Globilisation of our economy is accelerating. For South African business leaders this creates a sea of export opportunities,” he said.

Although there are ongoing demands for substantial profit growth from shareholders, the days of focussing only on their interests are gone, said Mr Pretorius. Stakeholder commitment now enjoys high priority and business leaders have to deal with the challenges accompanying black economic empowerment and employment equity.

Customers are also well-informed and demanding. Business leaders could easily loose the loyalty of their customers because of a hyper-competitive environment with an oversupply of goods and services.

Mr Pretorius stated that staff want to be involved and are looking for meaning in their workplace. Employers also have to deal with HIV/Aids in their workplaces. Trauma, absenteeism and financial implications could have a great effect on the viability of a business.

Against these changes Mr Pretorius pointed out the challenges business leaders are facing. In doing so a number of questions arise. The external business climate is characterised by turbulence and change. Internally there is a need for stability and meaning. How do we handle both challenges effectively?

Because of changes strategy decay is taking place and past strategies become irrelevant. Mr Pretorius said that business leaders need to modify their business models to prevent the downfall of their companies.

It is important for leaders to know what is happening in their world. “Continuous innovation is a critical success factor. The reality is that innovation is the only insurance against irrelevance,” he said.

Because of a changed environment leaders must perform and transform, simultaneously. How do we strike a balance between focused transformation and the achievement of world class performance, asked Mr Pretorius? “We need to bring about meaningful and sustainable empowerment, in order to create an inclusive economy and society. Leadership and management profiles should reflect the diversity of our teams, however at the same time every effort should be made to stop the brain drain and retain the expertise of experienced white managers.”

He also stated that leaders have an important role to play in terms of employment creation and corporate caring. “Sustainable stability and prosperity will not materialise without efforts in this regard.”

Mr Pretorius said that above challenges could be addressed by developing the ability to focus on creating a better future, rather than defending the past, a long-term vision, facing new realities, enhancing the value of brands and mobilising IT and the Internet to serve the business and customers better.

Retaining a positive vision of the future, embracing change and transformation, building your business according to the right principles and values and aspiring to be the best are some of the guidelines, according to Mr Brand, for future business success. He stated that creating a value advantage above one’s competitors, customer satisfaction and retention and inspirational leadership will add to the success of one’s business.

“We are indeed living in the era of the ultimate challenges, but also the ultimate opportunities. Let me clearly state that I have hope – in my view the tide has turned. Every day I experience small miracles inspired by ordinary people making an extraordinary difference,” said Mr Pretorius.

 

Media release
Issued by: Lacea Loader
Media Representative
Tel: (051) 401-2584
Cell: 083 645 2454
E-mail: loaderl.stg@mail.uovs.ac.za
5 November 2004

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