Programme Director;
Your Excellency, Consul General of South Africa, Mrs Mathula Magubane-Nkosi;
Your Worship, the Mayor of Ilembe District, Cllr. Musa Mdabe;
The Head of Department Foreign Trade, Ministry of Finance and Economics, Bernd Reuter;
The Senior Vice President of the German-African Business Association, Mr Walter Englert;
The CEO Trade and Investment KwaZulu-Natal, Mr Zamo Gwala;
The Members of the Business Delegation from KwaZulu-Natal;
Captains of Industry from the province of Baden Wurttemberg;
Our partners, Afrika-Verein;
Ladies and gentlemen.
All protocol observed.
We are indeed honoured to be part of this important occasion wherein we meet to discuss ways and means of strengthening our ties for mutual and accelerated growth in our respective countries.
Programme Director, before we make our remarks, we want to start by expressing our country’s appreciation to the people of Germany for joining the world in wishing the first President of a free South Africa and the real international icon for world peace, stability and prosperity, our beloved President Nelson Mandela, well as he continues to battle his illness.
Your prayers and warm wishes for the past two months have kept us, as a nation, strong and even more determined to bring to fruition the ideals that President Mandela struggled for – which have become the benchmark for what could be regarded as justice in the whole world.
We will continue to count on your solidarity and prayers as our country attempts to deal with the various challenges facing, not only our country, but the entire African continent and the world. Madiba’s selfless contribution to the promotion of global stability and collaboration amongst the nations of the world will continue as the legacy that we as South African are obliged to share with the rest of the world.
Further, on behalf of the people and government of South Africa, we want to re-iterate that South Africa, including our Province of KwaZulu-Natal, is stable. We are still committed to the creation of a society characterized by equality, prosperity and democratic practices.
Indeed, our Constitution, sighted among the most progressive legislative frameworks in the world, is still the lodestar that guides us as we navigate our path to a society that President Mandela sacrificed for and envisioned. Indeed the rule of law; a zeal to build a new, united and progressive society as well as efforts to drive an agenda that will make our world a better place, are among the pillars of our government’s growth and development vision.
We felt it was important to re-state this, although most of you as friends of our great nation are already aware of the ideological outlook which forms the basis of what South Africa wants to be – a society based on the respect for human rights and the rule of law.
Programme Director, deliberated let me re-iterate that while we are a proud part of the Republic of South Africa, our intention this morning is to engage with you about the Province of KwaZulu-Natal. This engagement, as we said earlier on is aimed at strengthening the ties that already exists between our two countries, particularly with a view of growing trade between our two countries as well as promoting investment.
Therefore, while our address will generally be about KwaZulu-Natal, it would also attempt to locate what we say within the context of the whole Republic of South Africa as well as the entire African continent as we take cue from the national legal and policy provisions.
This implies that what we achieve as the province has a butterfly effect across the country hence it is essential that we remind all and sundry that KwaZulu-Natal is positioning itself as the gateway to South Africa and the rest of the SADC regions based on a number of factors that include our strategic location on the Eastern Sea-board which features amongst other things highly developed ports in Durban and Richards that provide logistical capacity to trade with the rest of the world.
Meanwhile, our advanced trade facilities have been enhanced by the construction of the brand new King Shaka International Airport which in fact is the anchor project of the mega industrial development initiative in the province, the Dube Trade Port which is part of the multi-modal logistics platforms where there is a convergence and complementary of business sectors that make KwaZulu-Natal an ideal place for investment.
The port provide space for potential investors in various sectors such as hi-tech businesses, time-sensitive products and freight services for a wide range of in and out bound markets. Further, more as one of the nine provinces that constitute the Republic we share borders with three countries, namely Swaziland; Lesotho and Mozambique.
We also share boundaries with three of our sister provinces such as Mpumalanga; the Eastern Cape and the Free State province – all making KwaZulu-Natal a real spring board for cross border trade in the region.
Meanwhile we have made significant progress in practically aligning our economic activities with provincial and national neighbours as we believe that potential investors would definitely prefer convenient trade options that give them opportunities to initiate and explore investment opportunities that are not encumbered by trans-border restrictions.
Being the currently the second biggest economy in our country that contributes about 16% percent to our country’s Gross Domestic Product, we feel obliged that we have to be pro-active in mobilising potential investors that would develop keen interest in forging alliances with our own entrepreneurs that would in the long run benefits the province and its partners in the trading world.
Of the approximately 52 million people who make up the population of South Africa, more than 10 million reside in our province and as elucidated above, KwaZulu-Natal is home to two of Africa’s premier ports in Durban and Richards Bay. Meanwhile the increasing South Africa’s global trade and our symbiotic link to the SADC region have forced the nation to consider investing handsomely in the development of the two ports.
The former, which handles between 60 to 80 percent of our country’s cargo tonnage, is earmarked for a multi-billion rand expansion in the form of an addition dug-up port to complement to the already chocking harbour.
This is a demonstration that the embrace of democratic rule in our beloved nation has triggered confident amongst members of the business community the world over and a the province blessed with a strategic location, we have an obligation to lead in the process of alerting the global community about investment opportunities available in our province, country and the region as a whole.
The port expansion on the former Durban International Airport on the south of Durban is expected to instigate various business operations, from construction, manufacturing and additional petro-chemicals.
While we may not have reached the mark we would want to achieve with respect to other sectors, however we are proud of the fact that the manufacturing sector contributes close to 20% of the province’s GDP. Our province is also our country’s leading net attractor of domestic tourists and is still growing.
It is a stable province that works hard and is always seeking new and innovative ways of accelerating its own development – be it social, economic or even political. Why are we sharing this with you this morning?
We have this engagement because of, amongst other things, there are two major factors. The first one relates to the fact that there has been a shift in the global economic landscape, largely due to the economic downturn which started in 2008. Over the past five years, there has been unanimity among the global economic players that the balance of power has shifted to the so-called emerging economies and economies in the east, with India and China being the new frontiers of growth.
Also, the analysts are unanimous that Africa is the next frontier of growth. The 2013 Foreign Direct Investment (FDI) Report concedes that 2012 was a difficult year for FDI when compared with 2011. The report states that: “While all regions of the world experienced a decline in FDI, the decline in FDI into Africa was less than the world average and Africa increased its market share of global FDI projects from 5.56% in 2011 to 6.01% in 2012.
In contrast, the global market share of western Europe fell 1.5% in 2012, due to the European debt crisis and stagnating economic growth”. It is common cause, Programme Director, that, as was the case with the 2008 global economic downturn, African economies have remained resilient and investors have voted with their wallets by investing in our continent.
The slowing down of economic growth in the world’s second biggest economy, China – from double digits not so long ago to a projected 7.5% may mean that indeed the time has come for all discerning investors to cast their eyes into the African continent.
The second factor, which is closely linked to the altering global economic power relations, stems from the fact that, despite the hardships experienced by Europe, Germany remains South Africa’s second biggest trading partner. As you are aware, in 2010 goods worth over 4,3 billion Euro were exported to Germany while, in the same period, South Africa imported goods worth about 6,8 billion Euro from Germany.
With Germany having proven itself as the mainstay of the Eurozone economies, it made perfect sense that we should engage with our German counterparts in nurturing and growing trade between the two countries as well as according German businesses a friendly entry into the African continent via South Africa and KwaZulu-Natal in particular.
We believe, therefore, that it is in the interest of both of our countries to strengthen trade links. It is for this reason that in 2005, we signed a Cooperation Agreement between the province of KwaZulu-Natal and the State of Baden-Wurttemberg in order to structure our engagement.
This trade liaison is partly about us bringing into physical expression the terms of reference of that agreement. We have also come here so that together with all the social partners in this state, including government; the business sector and civic society, we can resuscitate the agreement and make sure that it is an implementable document because, currently, both the states – Baden-Wurttemberg and KwaZulu-Natal, have not pursued the implementation process of the agreement with the vigor that it deserves.
Among other things, the agreement’s areas of cooperation included:
- The strengthening of friendly relations and cooperation with a view to the promotion of improved knowledge and mutual understanding between the citizens of the two regions;
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The promotion of development and cooperation and the exchange of knowledge, skills and the expertise in the following fields:
- The enhancement of economic development through trade and investment
- Enhancement of the Provincial Food Security Programme through exchange of knowledge and expertise;
- Tourism;
- Agriculture development and agri-business
- Education and training, and Sport.
Obviously, with the developments in the global economic environment, including a change in priorities within our two administrations, we may need to revisit the terms of engagement and make necessary alterations where there is a need.
This fact notwithstanding, we need to start to live the agreement now and ensure it is transformed into a living document that tangibly begins to deliver on its billing as it was initially conceived by our governments.
We feel that the time is now for us to take our relationship to a higher level. While we are pleased that German companies including Behr South Africa; Lanxess; Afrox; Bayer; BASF; Amino Actives; Aunde and Evonik Industries have already invested in our province, we feel that with the awakening of the sleeping giant that is the continent of Africa and South Africa’s strategic location, more German companies should be investing in or trading with us.
Programme Director, the one perception that we would not like our German friends to take out of this morning’s engagement is that we are only selling the province of KwaZulu-Natal as a trading partner or investment destination. What we want out of this engagement is the kind of relationship that is mutually-beneficial to all partners as stressed in the initial parts of this address.
If we increase trade volumes between our provinces, our countries and of course our continents, it should be on an equitable basis. Obviously equitable basis cannot be manufactured but must be as a result of both trading partners co-operating and assisting each other where applicable.
Secondly, what we offer as a province is not only the approximately 10 million people market which is made up of the citizens of our province nor the 52 million made up of the Republic of South Africa. With the imminent regional economic integration, we offer access to the market of more than 250 million citizens in the Southern African Development Community (SADC).
Indeed a relationship with the province of KwaZulu-Natal opens doors to the more than 682 million people market that makes up SADC; the East Africa Community (EAC) and the Economic Community of West African States (ECOWAS) or the almost 3 billion market of the BRICS block as you know our country is part of this alliance of nations with fast growing economies.
However, Programme Director, we must stress as Government of KwaZulu-Natal, working together with the central government that we are hard at work transforming our province into the economic giant that it should be. In this regard, the state has invested a lot of money into expanding the Durban Port; ensuring that the Richards Bay Industrial Development Zone, which will be one of our province’s two special economic zones, is at the global level to attract and retain new investments into our province.
Of particular significance is that in the year 2010, we opened the King Shaka International Airport which is the centre piece of our province’s fit-for-purpose aerotrpolis. Within this precinct is our province second special economic zone which is the Dube Trade Port – which I briefly made a reference to earlier on.
Indeed, in terms of connectivity, we can proudly proclaim that no region in Africa comes close to us in terms of our competitiveness.
In conclusion, Programme Director, we want to proclaim, without equivocation, that KwaZulu-Natal is the best province to do business with.
We have the political stability; we have a responsive government; we have the right policies; we have tailor-made structures to take investors through all the steps needed to do business with us. We are favoured by both geographical location and the global economic conditions.
We therefore invite all of you to take this conversation forward with the business delegation that is part of this trade mission as well as with our Embassy Mission here in Germany whilst Trade and Investment KZN is the key liaison for those intending to do business with our beloved province.
Moreover Afrika-Verein has proved to be a reliable strategic partner in our efforts to promote trade between KwaZulu-Natal and Germany. Once again, I want to stress that we need to take our relationship to another level for mutual growth and development and this is essential to demonstrate that engagements like this are not just talk shops but an illustration that we are serious about walking the talk.
I thank you!
