Are SACU countries self-sufficient in cereals? A dynamic panel analysis

Abstract

ABSTRACT Most countries within Southern Africa are reliant on cereal imports from South Africa, Zambia, and Zimbabwe. In the Southern African Customs Union (SACU) region, cereal insecure countries are often import-dependent. Changing income levels, pandemics, climatic conditions and the trade environment all create a wedge and put pressure on food self-sufficiency. This paper uses a robust dynamic approach of a five-country panel to investigate the key determinants of cereal self-sufficiency in the SACU region. Long-term and short-term effects of selected variables are tested using a dynamic panel data model. The key long-term drivers for cereal self-sufficiency are identified and the short-term results reveal that land surface and rainfall are statistically most significant at a level of ten percent. The Dumitrescu-Hurlin panel causality test suggests that SACU member states could propose further macroeconomic harmonisation and good governance to stabilise national income to cushion against the possible increased cost of cereal production especially in Lesotho, Eswatini and Namibia. The adoption of climate smart technology to safeguard against rainfall variability and reduce the carbon footprint is important to foster an increase in agricultural productivity. A lack of effective harmonised policies may lead to an acceleration in cereal production insecurity and increased poverty.