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Johannesburg - Food security is one of the most important issues facing the global retail industry, according to Pick n Pay Stores [JSE:PIK] chairperson Gareth Ackerman who is also chairing the Global Consumer Goods Forum (GCGF).
Ackerman was speaking on Wednesday at the opening of the GCGF summit in London.
The summit brought together the senior leadership of retailers, manufacturers and service providers from 70 countries to deliberate on the implementation of best practices along the value chain and set the global agenda for the consumer goods sector.
Ackerman said the global economic environment was still reeling from the effects of a world-wide recession and is facing new threats as markets are battered by concern over Europe's financial system.
Consumer demand remains suppressed in the face of declining disposable incomes and tight credit.
"Added to this is the profound shift in the sentiments and expectations of our customers," said Ackerman.
"Consumers have embraced a new era of consumer activism, in which they are seeking old-fashioned value, convenience and choice.
"They are generally better informed, more demanding and savvier than any previous generation, and that mastery of information has enabled them to exercise choice with a power and freedom that was totally foreign to their forebears."
Sustainable development
Ackerman elaborated on the complex issue of sustainable development, linked to health through malnutrition, as well as sustainable economic development, environment, and trade.
"In most developing countries, agriculture is the largest source of employment and international agriculture agreements are crucial to a country's food security," he said.
"There is thus a stimulating debate afoot among World Trade Organisation (WTO) member states about the liberalisation of markets and its implications for the food security of whole communities," he said
"In the midst of such debates, there is a desperate need for a rapid return to stability and predictability in world markets if the manufacturing, supply chain and retailing of consumer goods is to flourish to the benefit of the communities and societies in which we operate."
Ackerman said that business will drive innovation most readily, create competitive advantage most effectively and generate tax-yielding profits most efficiently when government is proactive in its role of setting the standards and rules within which to operate.
He said that where governments fail to put in place unambiguous, predictable and consistent legislative and policy frameworks, the sustainable development of business becomes difficult.
"In South Africa, an on-going debate about the nationalisation of land is a case in point and indicative perhaps of a possible trend in many emerging economies.
"Ambiguity and uncertainty threaten food security and lack of clarity about land tenure will make it difficult for farmers to raise capital.
"This is a vital necessity as food security confronts the broader global community with considerable challenges, including a changing climate, declining soil fertility and water limitations.
"This is intensified as farmers face tougher access to credit and a shift to biofuel production.
"We can never take food and water for granted. Challenges such as these are unequivocally our business.
"We have no choice but to place retailing in the larger social and environmental context which will define how well we are doing our work."
Retail diversity
Ackerman said a further threat to food security is the global corporate consolidation in food retailing, distribution and production.
"Take America for example, where the top five food retailers now control more than half of all grocery sales in the country," he said.
He said the challenge was to explore ways of recreating real retail diversity that provides operating space for both small locally owned outlets that source a majority of their products locally and the large chains that are uniquely able to offer economies of scale and shopping convenience.
- I-Net Bridge
