SA retailers warn of growing food insecurity

South Africa's consumer goods sector, which is a major employer in the country with more than 2.5 million employees, is facing mounting challenges. The CEO of the Consumer Goods Council of South Africa, Zinhle Tyikwe, recently shared insights from the annual consumer goods summit with CNBC Africa. The sector is grappling with a multitude of issues including infrastructure challenges, escalating costs of doing business, and economic pressures affecting both corporations and consumers. The annual summit, themed 'Creating Connections, Building Bridges Together,' provided a platform for industry players to discuss solutions and strategies to navigate these challenges. Tyikwe highlighted the significant financial burden that businesses have had to bear due to increasing infrastructure challenges, particularly related to load shedding. She mentioned that companies have been spending approximately 1.5 billion annually on alternative power sources to mitigate the impact of power outages. In addition to this, the existing costs of doing business in South Africa have been further compounded by issues such as water shortages, road infrastructure deficiencies, crime, and logistical challenges. Tyikwe emphasized the importance of collaboration between the private sector and the government to address these pressing issues. One of the key recommendations from the summit was the need for public-private partnerships to create an enabling environment for businesses to operate efficiently. Tyikwe noted the importance of working with government agencies, such as Eskom, to identify opportunities for collaboration and investment in critical infrastructure projects. The CEO also highlighted the role of industry initiatives like the CEO initiative led by Business for South Africa, which aims to address issues related to crime and fraud that impact businesses. The sector is also grappling with the dual challenge of rising costs of living for consumers and the cost of doing business for companies. External factors such as global conflicts and inflation have further strained the sector, with food prices in South Africa experiencing a 14 percent increase. Tyikwe stressed the importance of industry organizations working closely with the government to address policy and regulatory issues that impact businesses and consumers alike. Looking ahead to the upcoming medium-term budget, the Consumer Goods Council of South Africa is advocating for tax incentives for businesses that invest in municipal infrastructure projects. Tyikwe highlighted the submission of proposals to the South African Revenue Service (SARS) to explore tax rebates on company taxes for investments in critical infrastructure like roads and waste management. The aim is to incentivize businesses to contribute to national development and assist the government in addressing infrastructure challenges. In conclusion, Tyikwe reiterated the sector's commitment to actively engage with government stakeholders and contribute to the country's economic development. The proposed tax incentives for infrastructure investments can serve as a catalyst for businesses to play a more significant role in building a sustainable future for South Africa.