Prodoc pims5686 SouthAfrica National abs project

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2.Development Challenge

Context, issues and global significance

South Africa has made remarkable progress since its transition to democracy in 1994, but the complex nature of the country’s development situation is evident from its ranking of 123 out of 187 on the Human Development Index. While extreme poverty has declined, there are significant disparities in levels of relative poverty across provinces. Income inequality (with a Gini coefficient above 0.7) and unemployment remains high, particularly among youth (at 34.5% for the 15-34-year-old age group).
South Africa is the second largest economy in Africa (according to GDP ranking). The main economic sectors include mining, agriculture and fisheries -- primary sectors based on the country’s significant natural endowment. South Africa’s economy also builds on a reasonably developed industrial base, which includes a modest, but emerging home-grown nature-based pharmaceutical and cosmetics sectors. The country has a strong consumer base among its 55 million inhabitants, but the current outlook for the economy is of slow growth, with GDP growth projections pointing out to a modest rate of less than 1% in 2017.
South Africa displays varied topography across a land area of 1.2 million sq. km with strong oceanic influence. It harbours a wide range of climatic zones and vegetation types, some of which are unique in the world. From an evolutionary point of view, the combination of the afore-mentioned elements created ideal conditions for the diversification of species and habitats, placing South Africa among the 17 megadiverse countries in the world. The diversity of South Africa’s biological resources is expressed both in terms of species richness and endemism.
Furthermore, South Africa is home to people of diverse origins, cultures, languages, and religions, many of which fall under the notion of ‘indigenous and local communities’ – meaning that they embody traditional lifestyles relevant for the conservation and sustainable use of biological diversity. Those groups are prominently known as bearers of traditional ecological knowledge and include various First Nations Indigenous groups.1 Among them, are tribes that are collectively known as Khoi-San and to whom knowledge on the use of Rooibos (Aspalathus linearis) and Honeybush (Cyclopia spp.) e.g. has been established in the literature.2
Traditional knowledge (TK) on the use of indigenous species has been an important component in the improvement of natural resource management in South Africa. When shared and combined with science-based Research & Development (R&D), TK can not only provide valuable information on the sustainable use and protection of ecosystems and species, but it may also accelerate new scientific discoveries based on genetic resources.
South Africa ranks 30 among the 78 nations that spends more than $100 million (PPP) in R&D and has a vibrant academic community. 3 Some of this R&D effort is aimed at carving out competitive niches for the country through nature-based and intellectual property business development, involving several of the country’s centres of excellence, universities and, not least also, the private sector.
At the global level, the approval by Parties to the Convention on Biological Diversity (CBD) in 2010 of the Nagoya Protocol, on access to genetic resources and the fair and equitable sharing of benefits arising from their utilization (also known as Access and Benefit Sharing or ABS), brought more legal certainty to otherwise unequal relationships between TK holders and the nature-based industry that exploits genetic resources.

With the current prospects for developing successful value-chains from the diversity of its genetic resources, the quest for South Africa in this context pertains to addressing both ABS issues and related conservation issues in the development of these value-chains.

The Bioeconomy of South Africa

The conservation and sustainable use of South Africa’s biological diversity is of strategic importance for the country. As South Africa is both a provider and a user of genetic resources, the maintenance of ecosystem services – now and in the future – is also of critical importance.
With technological progress, the importance of genetic resources from species that are indigenous to South Africa also comes into play – opening up a wide range of possibilities for business growth and local development.
With this vision in mind, and under the leadership of the Department of Environmental Affairs (DEA), the Government of South Africa launched its National Biodiversity Economy Strategy (NBES)4 in 2015.
The NBES is concerned with supporting the development of businesses and economic activities, which either depend directly on biodiversity, or whose activities contribute to conservation of biodiversity. Two economic segments are on focus in DEA’s policies for the Bioeconomy: (1) the wildlife sub-sector, which is concerned with live sales of indigenous wildlife; sale of game meat and the hunting industry; and (2) bioprospecting. This project is concerned with the role of the latter in the NBES. (See Box ).

Box . Important definitions for the biodiversity economy included in the 2015 NBES

Quoting from the 2015 NBES:

NBES, a 14-year strategy, will have the core focus of providing an enabling environment for communities and entrepreneurs to participate in the biodiversity economy, while contributing to poverty alleviation, sustainable development and conservation of the country’s rich biodiversity and ecosystem services.

The NBES seeks to contribute to the transformation of the biodiversity economy in South Africa through inclusive economic opportunities, reflected by a sector which is equitable - equitable access to resource, equitable and fair process and procedures and equitable in the distribution of resources (i.e. business, human, financial, indigenous species, land, water) in the market.”

Core sectors that underpin the Bioeconomy in South Africa, as of current policies[a]:

  • The bioprospecting sector: which encompasses organizations and people that are searching for, collecting, harvesting and extracting living or dead indigenous species[b], or derivatives[c] and genetic material thereof for commercial or industrial purposes.

  • The wildlife sector: which is centred on game and wildlife farming/ranching activities that relate to the stocking, trading, breeding, and hunting of game, and all the services and goods required to support this value chain.


[a] More recently, and through a series of intense workshops led by DEA, the ‘Coastal Tourism Sector’ may also come into play in South Africa’s Bioeconomy. The workshops were aimed at operationalizing the 14-year NBES and were referred to as ‘Operation Pakhisa’,

[b] Indigenous species are species that occurs, or have historically occurred, naturally in a free state in nature within the borders of the Republic, but excludes a species that has been introduced in the Republic because of human activity.

[c] Derivative in relation to an animal, plant or other organism, means any part, tissue or extract, of an animal, plant or other organism, whether fresh, preserved or processed, and includes any genetic material or chemical compound derived from such part, tissue or extract.

Source: DEA (2015): National Biodiversity Economy Strategy (NBES) for the Department of Environmental Affairs, Republic of South Africa. Government Gazette, 9 October 2015.

Although the prospects for business development within the bioeconomy are attractive, the NBES recognizes that nature-based activities more generally – and biotrade value chains more specifically – need to comply with sustainability frameworks, in addition to national and international legislation concerning access to genetic resources and the fair and equitable sharing of benefits arising from their utilization (i.e. ABS). South Africa’s ratification of the Nagoya Protocol in 2013 strengthened the national framework for ABS compliance, but it also “raised the bar” for these frameworks.

Combining both the wildlife and the bioprospecting sub-sectors, the more tangible contribution of the biodiversity economy to the national economy can be measured in terms of its share of GDP, which in 2013 corresponded to approximately ZAR 3 billion (equivalent to $242 million current USD). By 2015, this contribution was estimated to reach to ZAR 3.34 billion ($258 million USD). According to the NBES, bioprospecting is responsible for less than 10% of this revenue and growth. The wildlife sub-sector has demonstrated remarkable growth, development and economic transformation potential over the past 10 years. However, the bioprospecting sub-sector have lagged far behind, both in size and in growth rate. NBES analysis estimates, based on international trade data, a sustained global growth in bioprospecting related trade approaching 20% per year, compared to a growth rate in South Africa of around 6% per year. This analysis indicates the existence of severe constraints in the South African bioprospecting supply chain.

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