D Shabalala on behalf of Z Mkhize: Foskor Richards Bay

24 November 2006

Programme Director, Ms Gcina Mhlophe,
Mr Alfred Pitse, President and Chief Executive Officer (CEO) of Foskor,
Mr Neel Naidoo, Vice President of Foskor Richards Bay,
Dr BV Mthethwa, Councillor and Mayor of Uthungulu District Municipality,
Mr Bongani Mqaise, Chief Executive Officer (CEO) Zululand Chamber,
Board members of Foskor Group,
Amakhosi,
Managers and other representatives of Foskor present,
Distinguished guests,
Members of the media,
Ladies and gentlemen,

It is indeed an honour to represent the MEC for Finance and Economic
Development at such a historic occasion in the history of one of the country's
leading industrial companies.

Today the Foskor Group has three main production facilities in the country
with KwaZulu-Natal comprising of two operating entities; it is therefore safe
to regard Foskor as a KwaZulu-Natal company! I am told that Foskor already
commands an impressive eight percent of the traded phosphoric acid market share
worldwide, making it one of the largest producers worldwide. I am also pleased
to hear that the company does not intend to rest on its laurels, aiming to grow
this market share to 12 percent and to become the third largest producer in the
world. These achievements in just three decades of operation certainly provide
cause for celebration.

From the perspective of the provincial government, we will certainly do
everything in our power to help Foskor grow and achieve its targets as this
growth aligns perfectly with our provincial economic development strategy. This
strategy recognises the industrial sector as a key component of the regional
economy with the potential to lead the way in terms of growing the economy and
creating jobs. The strategy has also identified the agricultural sector as the
key to addressing poverty in the province since most areas of poverty are
rural. As government we see an important role that Foskor will play in
achieving that since the provincial government has invested a substantial
amount of money towards achieving that goal.

Sustainability and investment in human capital

One of the most important elements of growing companies and by extension,
the economy is investment in human capital. In this regard in the past 30 years
Foskor has already contributed to the development of the local communities in
terms of job creation and skills development. In today's increasingly
competitive world driven by globalisation, companies can only survive and
prosper by investing in their people and developing an innovative and
entrepreneurial culture.

World wide trends show that companies derive their competitive advantage
mainly through the quality, commitment and knowledge of their employees.

Indeed the most important business resource today is knowledge. According to
a research fellow at the Malaysian Institute of Economic Research (MIER),
strong human capital attracts and encourages growth not the other way
around.

An educated population also contributes to higher growth rates and
productivity by inter alia creating a larger tax base.

All this is by way of saying that ongoing investment in human capital should
be an integral part of any successful company's strategy and indeed is a key
determinant in all successful economies across the world. The availability,
skills and productivity of a nation's human capital determines the rate of
growth of its economy and competitiveness in world markets. With technological
advancements in transportation and communication, increasing mobility of
qualified workers is becoming the norm. This presents a major challenge to
developing nations which can least afford the loss of scarce skills due to the
competitive nature of the international job market. South Africa certainly has
suffered substantially in recent years from this "brain drain." So much so that
the national government recognises that if it is to achieve its growth targets
of six percent and more in the medium term, it is going to have to address the
skills shortage in all key sectors of the economy. To this end the honourable
Deputy President, Phumzile Mlambo-Ngcuka, is leading the Joint Initiative on
Priority Skills Acquisition, which is a joint initiative between government,
business and labour.

What has all this to do with Foskor? The point is that Foskor by virtue of
its size and location in one of the areas of the province with the highest
unemployment and poverty rates, is ideally placed to make a significant impact
on the economies of uMhlatuze and uThungulu by creating more jobs; by supplying
skilling and training employees at all levels; by providing managerial
positions to deserving employees from previously disadvantaged groups; and by
recruiting and retaining the professional engineers and technical experts
needed to sustain the company's growth. It is for this reason that government
at local, provincial and national levels has cause to join in the celebrations
when international scale companies like Foskor reach important milestones such
as that which we pay tribute to tonight.

Investment attraction efforts

Ladies and gentlemen, I am pleased to announce that next year from 28
October to 1 November 2007, we will be hosting a major KwaZulu-Natal Investment
Conference and Exhibition. This major international marketing event will be
co-ordinated by the Department of Economic Development and its public entity,
Trade and Investment KwaZulu-Natal. I encourage you to participate actively in
this exhibition as it will almost certainly unlock major marketing
opportunities for Foskor.

I for one have no doubt that Foskor's expansion plans in KwaZulu-Natal are
perfectly timed. Investor confidence in the region is high; statistics from the
Department of Trade and Industry show an annualised increase of investment into
the province of nine percent over the last three years, with total investment
amounting to US$20 billion. The provincial government has made the promotion of
inward investment into the province one of its key priorities and the MEC for
Finance and Economic Development has led several very successful trade missions
to countries such as Germany, Italy, Korea, Japan, India and the Gulf States in
the last year. He has also hosted several trade delegations to the province
arising directly from contacts made during the outgoing missions. Just this
week the MEC and Trade and Investment KwaZulu-Natal hosted a government and
business delegation from the Sultanate of Oman. The visit was a result of a
trade and investment mission to the Gulf Region that we undertook in May this
year.

That mission was very successful. In Oman, leads were developed in tourism,
travel, water services (pumps and pipes), inter-cultural activities like the
Omani Cultural Festival, agriculture, port operations, oil and furniture. Trade
and Investment KwaZulu-Natal is currently facilitating several joint ventures
and business links between small and big business and between foreign investors
and local business in investment projects in various parts of the province.

To mention a few examples. At Eshowe, a Belgian company is investing R75
million in a plastic manufacturing development which will create 100 jobs.

Another plastic manufacturing project is being finalised for Durban. This is
a joint venture between an Indian company with 50 percent local ownership and
management.

In Pietermaritzburg, a company from China is involved in a R150 million deal
to manufacture seats for stadiums. This company with a 40 percent black
economic empowerment (BEE) component will create 50 jobs. There are many other
projects getting off the ground across the province in sectors as diverse as
furniture making, automotive assembly (with a major investment by the Tata
Group right here in Richards Bay), mining, tourism and agri-processing,
including several bio-fuel plants under consideration.

In conclusion allow me to emphasise that the provincial government is fully
supportive of Foskor's presence in KwaZulu-Natal and even more supportive of
its growth plans and investment into the local economy. We will do everything
feasible to support you in your efforts to grow Foskor into a dominant player
in international terms. I do not make this statement lightly. In the next two
years the provincial government will be spending R190 million in developing the
infrastructure required to make the Richards Bay Industrial Development Zone
(IDZ) achieve its full potential; this will have major benefits for companies
like Foskor. We are also investing in improving both rail and road linkages
into Richards Bay; for example, the provincial government has already committed
R90 million in this year's budget to upgrading the John Ross Highway and the
MEC for Finance and Economic Development will be making an important further
announcement in this regard when he tables the provincial adjustment's estimate
on Monday.

Ladies and gentlemen, a working partnership between government and business
is the key to helping KwaZulu-Natal unlock its potential and to take economic
growth rates to the sustainably higher levels, which we need to achieve our
targets of halving poverty and unemployment by 2014. For our part, let me
assure you that the provincial government of KwaZulu-Natal is committed to
providing stability and effective governance, which is the foundation for
sustained economic growth.

And on the evidence of the achievements we are celebrating tonight there is
no doubt that companies such as Foskor are prepared to play their part in
making KwaZulu-Natal a winning province and global player in the international
business scene.

I thank you!

Issued by: Department of Finance and Economic Development, KwaZulu-Natal
Provincial Government
24 November 2006
Source: KwaZulu-Natal Provincial Government (http://www.kwazulunatal.gov.za/)