1. E-mail: williamm@conninggarth.co.za
Macro-economic impact of the wine industry on the South African economy
Conningarth Economists
PO Box 75818, Lynnwood Ridge 0040,
Pretoria, South Africa
Tel: +27 (0)

2. Growth 2008-2013 (current prices)
(Rm)
2013 (Rm)
% change
% change
Primary production
3 320
4 820 37 45
Total turnover (excluding tourism)
19 164
26 359 79 38
Exports
6 272
8 514 99 36
Taxes
3 459
4 802 71 39
Domestic sales
12 892
17 845 76

3. Real growth in turnover (Rm; 2013 = 100)
1999
2003
2008
2013
2013/
1. Primary agriculture
2938
3247
2. Cellars
1424
1573
Sub-total
3184
4470
4363
4820
151.4
3.1 Manufacturing
5000
5635
7417
6510
3.2 Trade, catering, accommodation
8157
6730
8858
10227
Sub-total (1+2+3)
16341
18373
20820
26359
161.3
Taxes
1537
4545
4802
Foreign tourism
4551
4848
Local tourism
1051
1124
Total tourism
5602
5972
Total
24038
25601
30784
32331
134.5

4. Basic trends, 1997 - 2013 Cellars 1997 2008 2013 Producer cellars 6958 50
Private cellars
218
504
493
Producing wholesalers 8 23 21
Total wineries
295
585
564
Crush t of grapes 77
267
240
Crush t of grapes 76
150
155
Crush t of grapes 32
Crush t of grapes 52 63 55
Crush t of grapes 19 15 17
Crush >10000 t of grapes 39 40
% that crush <100 tons pa
26%
46%
43%

5. Basic trends, 1997 - 2013 Vines 1997 2008 2013 Total vine area (ha)
87 301
99 680
Vines 4 years and older (ha)
76 025
92 504
91 972
Vines younger than 4 years (ha)
11 276
8 822
7 708
Vines < 4 years as % of total (replacement at 20 years on average implies an ideal of 15% per year for vines<4 years)
12.9
8.7
7.7

6. Basic trends,
Grapes
1997
2008
2013
Total production (million litres)
881
1 089
1 157
Wine production (million litres)
547
763
915
Wine as % of total production
62.1%
70.1%
79.1%
Domestic sales (million litres)
367
356
370
Exports (million litres)
110
412
526
Proportion of production exported (%)
20.1%
53.9%
57.4%

7. Measuring the impact
Direct impact: This occurs via production, payment of wages and salaries, and profit generation by grape growing, wine making and the manufacturing sector (making brandy and grape juice, making bottles and labels, etc.)
Indirect impact: This refers to impacts on industries that provide inputs to the wine industry (e.g. the fertilizer industry)
Induced impact: This refers to a further round of economic activity that takes place because of additional consumer spending as a result of the additional salaries and wages from upstream and downstream industries

8. Impact categories

9. Macroeconomic impact (1)
Impact on
R million
GDP
36 145
Capital investment
62 277
Household income
23 579
- Low income
3 994 (17%)
- Medium income
4 945 (21%)
- High income
(62%)

10. Macroeconomic impact (2)
Impact on
R million
Fiscal impact
11 598
- National gov
(93%)
- Provincial gov
106 (1%)
- Local gov
684 (6%)
Balance of payments
17 783

11. Provincial impact Provinces GDP % Employment % Eastern Cape 10 8
Free State 4
Gauteng 15 13
KwaZulu-Natal 7 6
Limpopo 2
Mpumalanga
Northern Cape
North West 1
Western Cape 53 58
Total
100

12. Employment Numbers 2008 2013 Total 275 606 289 151 Skilled
(13%)
(15%)
+7000
Semi-skilled
(28%)
(29%)
+6400
Unskilled
(58%)
(56%)

13. Value chain of the wine industry
GDP
Employment

14. Poverty alleviation (R million)
Economic Sector
Low Income
Medium Income
High Income
Total
Primary Agriculture 55
(18%)
678
1 874
3 110
Cellars
238
(16.7%)
301
889
1 429
Distilling
858
1 085
3 187
5 130
Wholesale, Retail Trade
1 649
(16.9%)
2 027
6 094
9 770
Tourism
691
854
2 596
4 141
3 994 (16.9%)
4 945
(21%)
14 640
(62%)
23 579

15. Efficiency levels of the wine industry
GDP/Capital Ratio
Labour/Capital Ratio
Low Income Households/
Total Households Ratio
Wine industry
0.58
4.64
0.17
Agriculture
0.43
4.54
0.18
Mining
0.45
2.18
Manufacturing
0.47
2.88
Electricity and Water
0.24
1.13
Construction
0.59
5.99
Trade, Accommodation
0.57
4.52
Transport, Storage, Communication
0.35
1.95
Financial, Business Services
0.44
2.24
0.15
Community Services
0.78
4.45
Total economy
2.94
0.16