Trends in foreign agricultural trade and its impact on households in South Africa

Abstract

This study examines the trends in foreign trade in agriculture focusing on imports and exports for different sub-sectors and the identity of agricultural trade flows with specific regions and countries. Secondly, to understand how agricultural imports and exports improve the living standards of households in South Africa. The study uses a quantitative research approach by analysing trade data from the South African Revenue Services (SARS) and household data from the World Bank and OECD. The threshold vector autoregressive (TVAR) model is employed to establish a nonlinear causal relationship. The Diks-Panchenko nonparametric causality test revealed no causal relationship between the foreign agricultural trade and household consumption and household income in South Africa. However, with the increase of exported agricultural goods from South Africa, there are many significant benefits to South African households.