A new study by independent analysts Quantec Research has highlighted the significant economic contribution that BAT South Africa makes to the Western Cape economy. Figures recently released reveal the scale of the company’s direct contribution to jobs, taxes, GDP and businesses across the province, as well the impact of its wider value chain.
BAT South Africa’s total contribution to the Western Cape’s gross domestic product amounted to R1.48 billion in 2015, or 0.3% of the province’s GDP. For every one Rand of sales revenue generated by the company, R1.91 of value is added to the province’s GDP.
BAT South Africa CEO Soraya Benchikh said: “The Western Cape is our home and over 600 of our employees are based here. As this report shows, our operations sustain a further 3,785 jobs across the province, over half of which are skilled or semi-skilled positions, typically in small businesses such as spazas, taverns and component suppliers”.
For each job offered by BAT South Africa, five additional formal or informal jobs were supported across the Western Cape. The retail and accommodation sector, followed by the business service sector, were the biggest beneficiaries in terms of employment. The jobs sustained by the company’s operations in the Cape helped generate wages and benefits valued at R732 million in 2015.
The company purchased goods, services and equipment worth R651 million from suppliers based in the Western Cape. These suppliers, in turn, made successive rounds of purchases which lead to a multiplier effect that altogether stimulated more than R2.4 billion worth of output in the province.
As Benchikh explains: “We have a long history here in South Africa and while manufacturing locally and buying home-grown tobacco leaf is more expensive than elsewhere in the region, we are committed to sustaining this presence for as long as possible”.
BAT South Africa’s operations in the Western Cape generated tax revenues worth R940 million for the National Treasury. In perspective, this is enough to pay the annual salaries for 5,661 teachers or to build 5,857 low cost homes.
Said Benchikh: “As this report shows, BAT South Africa helps sustain tens of thousands of jobs and generate billions of rand in desperately-needed tax revenues. We can and should play a part in helping South Africa deliver its national priorities of economic growth, job creation and social inclusion.”
BAT South Africa recently moved its headquarters from Stellenbosch to the V&A Waterfront.