Hendrik van Broekhuizen

Position: Researcher

Institution: Department of Economics, Stellenbosch University

Expertise: Higher Education, Labour Econometrics

Hendrik van Broekhuizen is a PhD student in the Department of Economics at Stellenbosch University and works as a full-time researcher for the Research on Socio-Economics Policy (ReSEP) group (http://resep.sun.ac.za). As a ReSEP member, he has been involved in various projects relating to poverty, inequality, labour markets, and education. His research interests include behavioural economics, applied microeconometrics, labour economics, and the economics of education and his current research focusses on the linkages between tertiary education, skill-formation, and labour market outcomes in South Africa.

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Editor's Corner

How to enrich the region: what the evidence tells us

The economic challenges facing South Africa – and the region- are well documented. Less obvious are the solutions. This is why for the past decade or more, much emphasis has been based on evidence-based policy.

The political climate today may be uncertain, but it is much improved from the years of the Zuma administration, when, arguably, finding policy solutions to address the triple challenges of poverty, unemployment, and inequality was sidetracked by the period of ‘State Capture’.

There were, notwithstanding the challenges, concerted attempts to introduce research-based evidence into policymaking, including through the Research Project on Employment, Income Distribution and Inclusive Growth (REDI3x3), independent but backed by the Treasury, which spawned Econ3x3.

In 2018, the Treasury, with the support of United Nations University World Institute for Development Economics Research (UNU-WIDER), launched a three-year project known as Southern Africa – Towards Inclusive Economic Growth (SA-TIED). The programme sought to develop a platform ‘for evidence-based policy formulation to allow the Southern African region to prosper by: (i) tackling existing structural challenges supported by the production of policy-relevant economic research; (ii) building capacity of national and regional partners; and (iii) establishing efficient communications and policy- bridging channels to ensure policy uptake.’

It has been a remarkably productive exercise with 275 research papers produced in six workstreams, each ‘anchored in a government department.” For more on the project see https://sa-tied.wider.unu.edu/about

One workstream focused on regional growth for prosperity, a challenge in terms of policymaking as South Africa dominates the regional market in terms of exports and this has led to protectionist measures in some other countries.

In this edition of Econ3x3, we publish an article by Anthony Black, Lawrence Edwards, Ruth Gorven, and Willard Mapulanga based on their SA-TIED/UNU-WIDER paper. They focus on agro-processing and how it could boost development in the whole region. Agro-processing, they write, has huge potential but regional value chains are failing to include the poorer countries of southern Africa. Although the ratification of the African Continental Free Trade Area (AfCTA) is an important step towards strengthening trade links in the region, there is still much work to be done to spread the benefits more evenly.

Many southern African countries have a comparative advantage in agro-processing, which is relatively pro-poor and can boost employment. But weak investment environments and significant infrastructural constraints inhibit progress.

The authors spell out clear and concrete ways of enhancing the sector for the benefit of the region: one way is to induce or support supermarkets and food processors to nurture small, local suppliers. Supermarkets have, in the past, put up significant barriers to entry of small suppliers, but there is a tangible change of tack as governments and NGOs have begun to both mediate the relationships with, and the capacity of, small suppliers.

One example, as the authors show, is of the fast-food chain, Nando’s and its supply of chillies. Nando’s has more than 900 outlets, mostly in South Africa and the UK. It used to source chillies from the global market but it has made a significant shift. Today about 95% of its chillies are sourced from the southern African region, mainly from small suppliers in Malawi, Mozambique, and Zimbabwe. Some 1400 smallholder farmers are involved in the project, with tangible benefits to the wellbeing of their communities.

It is small successes such as this that show what the private sector working with government and NGOs can achieve. Policy – particularly about regional development, which involves some tough trade-offs – is a challenge to formulate. But the evidence provided by this and other papers in the SA-TIED project can act as an essential navigator.

Pippa Green, 21 September, 2022

Working Papers from the REDI3x3 project are available HERE

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The three Rs...

READ, WRITE & REASON

Econ3x3 provides a platform to promote robust economic policy discourse in South Africa. The complexity, but also sterility of public debate on many policy issues, demands that knowledgeable individuals engage in robust debate. This can inform other individuals and policymakers on issues that they deal with in day-to-day policy making or policy analysis.

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Hendrik van Broekhuizen

Articles

How to enrich the region: what the evidence tells us

READ, WRITE & REASON

Creating jobs, reducing poverty I: Why the informal sector should be taken seriously and enabled properly

Who are the middle class in South Africa? Does it matter for policy?

What is the role of manufacturing in boosting economic growth and employment in South Africa?

Adcorp’s employment and unemployment figures are not taken seriously by researchers – yet they can do much harm

Informal settlements: poverty traps or ladders to work?

Why are foreign-run spaza shops more successful? The rapidly changing spaza sector in South Africa

How much is inequality reduced by progressive taxation and government spending?

How high is graduate unemployment in South Africa? A much-needed update

A job in the informal sector reduces poverty about as much as a job in the formal sector

Who creates jobs, who destroys jobs? Small firms, large firms and labour market rigidity