Ramaphosa Addresses Retail Giants in South Africa on Corporate Behavior and Societal Commitments

October 21, 2025

Ramaphosa Urges South African Retailers Too Tackle Rising Food Costs And Curb Anti-Competitive practices

Johannesburg, South Africa – President Cyril Ramaphosa has directly called upon the nation’s largest grocery retailers to proactively address escalating food prices and actively avoid engaging in practices that stifle fair competition. The President’s appeal comes amid growing concerns regarding food security and the financial strain faced by South African households.

Food Inflation Concerns Intensify

President Ramaphosa, in his recent address, emphasized that ensuring food security and mitigating the impacts of the rising cost of living are paramount objectives of the current administration. Despite a general decrease in headline inflation to 3.3% in August, with projections remaining stable for september, food inflation has shown an upward trend, reaching a ten-month high last month.

Specifically, the prices of meat and fresh produce are increasing, placing considerable pressure on household budgets. A significant portion of the South African population experiences food insecurity, despite existing government interventions, such as the zero-rating of essential food items.

The Role of Major Retailers

The President underscored that improving food security is a collective responsibility, with a crucial role for dominant retail companies. He acknowledged the challenges faced by retailers, including increased energy and transportation costs, drought conditions, and disruptions in global supply chains. However, he insisted these challenges should not diminish their responsibility to contribute to affordability.

Ramaphosa identified Shoprite, SPAR, Pick n Pay, Woolworths, and Massmart as key players who must prioritize making nutritious food accessible to all South Africans. He commended retailers already implementing measures to reduce prices and maintain affordability, while stressing the need for greater focus on affordable, healthy options, including proteins, fruits, and vegetables, as their market share grows among low-income consumers.

Cartel Behavior Under scrutiny

President Ramaphosa also highlighted the detrimental effects of anti-competitive practices, such as price-fixing, which artificially inflate food prices and exacerbate food insecurity. He pointed to ongoing investigations by the Competition Commission, which have already resulted in a R1 million settlement with an edible oils producer found guilty of price fixing in February 2025.

The Commission has been actively investigating cartels within the bread, milling, grocery retail, fresh produce, and poultry industries. Their assessments have revealed a concerning trend known as the “rocket and feather” effect – retailers swiftly raise prices during market volatility but are slow to lower them when conditions improve. Data indicates instances where shelf prices have continued to rise even as producer costs declined.

While some staples, like canned pilchards, demonstrate responsible pricing, essential items such as eggs, frozen chicken, bread, sunflower oil, and maize meal continue to exhibit price stickiness and increased retail margins.

Government Policies and Their Impact

The President’s address did not directly address potential contributions from governmental policies to rising prices. Earlier this year, the ruling ANC proposed a value Added Tax (VAT) increase to 17%, a move widely anticipated to sharply raise food costs. Although the proposed hike was later reduced to 16% and later challenged in court, it highlights ongoing debates surrounding fiscal policy and its impact on affordability.

Understanding Food Price Dynamics in South Africa

Food price volatility is a complex issue influenced by a multitude of factors. These include global commodity prices, exchange rate fluctuations, seasonal changes, and local production levels. South Africa’s reliance on imports for certain food items makes it particularly vulnerable to international market fluctuations.

Factor	Impact
Global Commodity Prices	Increases in international markets translate to higher import costs.
Exchange Rate (ZAR/USD)	A weaker Rand increases the cost of imported goods.
Seasonal Changes	Weather patterns impact crop yields and livestock production.
Local Production Levels	Insufficient local supply necessitates increased imports.

Did You Know? South Africa is a net importer of wheat and rice, making it susceptible to global price shocks in these key staple foods.

Frequently Asked Questions About Food Prices in South Africa

What steps do you beleive retailers should prioritize to ensure food affordability for all South africans? How can consumers actively advocate for fairer prices and greater clarity in the food market?

Share your thoughts in the comments below!

What specific actions did President Ramaphosa request of retail giants regarding local procurement and SME development?

The Core of the Address: Responsible Business conduct

President Cyril Ramaphosa recently delivered a pointed address to leading retail executives in South Africa, emphasizing the critical need for responsible corporate behavior and demonstrable societal commitments. The meeting, held on October 20th, 2025, wasn’t a reprimand, but a firm call to action – urging retail giants to move beyond profit margins and actively contribute to the nation’s socio-economic development. Key themes included addressing economic inequality, fostering inclusive growth, and bolstering South Africa’s long-term stability.This dialogue comes at a crucial juncture, with South Africa grappling with high unemployment rates, persistent poverty, and the lingering effects of the COVID-19 pandemic.

Specific Areas of Focus & Demands

Ramaphosa’s address wasn’t vague. He outlined specific areas where retail companies could – and should – considerably improve their impact. These included:

* Local Procurement: A strong push for increased sourcing of goods from South african suppliers, especially Small and Medium Enterprises (SMEs). This directly addresses job creation and supports local economic growth. The President highlighted the potential for retail giants to act as catalysts for SME development, offering mentorship and access to markets.

* Fair Labor Practices: Reinforcing the importance of fair wages,safe working conditions,and opportunities for skills development within the retail sector and throughout their supply chains.This includes addressing concerns around precarious employment and the exploitation of vulnerable workers.

* Price Gouging & Consumer Protection: A firm stance against exploitative pricing practices, especially during times of economic hardship. Ramaphosa stressed the need for retailers to prioritize affordability and accessibility of essential goods.

* Community Investment: Encouraging greater investment in community development initiatives, focusing on education, healthcare, and infrastructure projects in areas where retailers operate.

* Supply Chain Transparency: Demanding greater transparency within supply chains to ensure ethical sourcing and prevent the exploitation of workers and resources. This ties into growing global concerns around sustainability and responsible sourcing.

The Economic Context: Why Now?

The timing of this address is significant. South Africa’s economic recovery has been sluggish, and the country faces numerous challenges, including:

* High Unemployment: Officially over 32%, unemployment remains a major concern, particularly among youth.

* Rising Inflation: Increasing consumer prices are eroding purchasing power and exacerbating economic hardship.

* Energy Crisis: Ongoing load shedding (rolling blackouts) is disrupting businesses and hindering economic activity.

* Social Unrest: The July 2021 unrest highlighted the deep-seated socio-economic frustrations within the country.

Ramaphosa argued that the private sector, particularly large retailers, has a crucial role to play in mitigating these challenges and building a more resilient and equitable economy. The call for corporate social responsibility (CSR) isn’t simply altruistic; it’s presented as a vital component of sustainable economic growth.

Retailer Responses & initial Commitments

initial responses from the retail sector have been cautiously optimistic. Several CEOs publicly acknowledged the President’s concerns and pledged to review their business practices. Specific commitments announced include:

* Shoprite Holdings: Announced a R1 billion investment in supporting local suppliers over the next three years.

* Pick n Pay: Pledged to increase the percentage of locally sourced products in its private label range.

* Woolworths: Committed to enhancing its skills development programs for employees and suppliers.

* spar Group: Indicated a review of its pricing policies to ensure affordability for low-income consumers.

however, analysts caution that these are initial pledges and require concrete action and measurable results. The effectiveness of these commitments will be closely monitored by government, civil society organizations, and consumers.

The Role of Black Economic Empowerment (BEE)

The address also touched upon the importance of Black economic Empowerment (BEE) and the need for retailers to accelerate transformation within their businesses and supply chains. Ramaphosa emphasized that BEE isn’t just about compliance; it’s about fundamentally reshaping the economic landscape to ensure greater inclusivity and possibility for historically disadvantaged communities. This includes:

* Increased Black Ownership: Encouraging greater Black ownership and control of retail businesses.

* Skills Transfer & mentorship: Providing opportunities for Black entrepreneurs and professionals to develop their skills and advance their careers.

* Preferential Procurement: Prioritizing procurement from Black-owned suppliers.

Potential Benefits of Increased Corporate Social Responsibility

A genuine commitment to CSR from South Africa’s retail giants could yield significant benefits:

* Enhanced Brand Reputation: Demonstrating a commitment to social responsibility can enhance a company’s brand image and build customer loyalty.

* Improved Employee Morale: Employees are more likely to be engaged and motivated when they work for a company that values ethical behavior and social impact.

* reduced Risk: Proactive CSR can help mitigate reputational and operational risks.

* Sustainable Growth: Investing in local communities and fostering inclusive growth can contribute to long-term economic sustainability.

* Stronger Social Fabric: Addressing socio-economic challenges can help build a more cohesive and stable society.

Monitoring & Accountability: The Path Forward

The success of this initiative hinges on effective monitoring and accountability. The government has indicated that it will