A Pahad: Briefing notes on international affairs

15 August 2006

Democratic Republic of Congo (DRC)
* Up to 80% of the votes have been counted so far.
* Predictions are that President Joseph Kabila is leading by 45%, followed by
Pierre Bemba at 22%.
* The Congolese Independent Electoral Commission (CEI) will announce
provisional results on 20 August 2006, while final results will be announced on
the 30 August.
* It is further anticipated that results for the parliamentary elections will
be announced on the 4th of September.
* Should no candidate obtain 51% of the votes, there will be a presidential
second round by the end of October or first week of November 2006.
* It is anticipated that the presidential elections will coincide with the
provincial elections.
* The Inter-Departmental Task Team on the DRC elections will liase with the
Independent Electoral Commission (IEC) and Defence to commence with
preparations for the upcoming elections as per United Nations Development
Programme (UNPD) Agreement signed in May 2006.

Côte d’Ivoire
* Since I last briefed you, three issues have emerged that are raising
concerns:
* the mandate of the President if no elections are held on 30 October
2006
* the national certification issue
* the ranks given to FN officers by the FAFN
* PM addressed these issues. The following are the key points:
- The President and the PM continue to work very well and he appreciated the
words of the President during the national day ceremony. They discuss matters
together before decisions are made. The President had praised the PM for his
efforts to advance the peace process and pledged his full support
- Assured the Ivorians and the international community that the nationality
certificates will be issued. This should be done within the legal
provisions
- On DDR the PM said the military dialogue between the Chiefs of Staff remains
the only channel to resolve the issues raised by the FN. He accepted that there
will be problems in addressing the issues but military dialogue should be
maintained as agreed in Yamoussoukro.
- He urged all parties to return to the negotiation table to address the
challenges. The PM believes that all the problems raised can be addressed
through the existing structures and the capacities created by the various
agreements.

Middle East
* The South African government yesterday welcomed United Nations Security
Council Resolution 1701 which called for an immediate cessation of hostilities
between Israel and Lebanon.
* Reports indicate that the ceasefire is holding.
* The South African government believes this opens up opportunities for peace
and stability in the region.
* We must however reiterate our concern that it has taken the Security Council
so long – almost five weeks of extreme violence, before it could act decisively
on the matter. We believe the 1 150 deaths and almost 5 000 casualties in
Lebanon could have been avoided. There has also been the massive destruction of
property and infrastructure. The international community must now respond
positively to the needs of the Lebanese people, hundred’s of thousands of who
have been displaced.
* We also urge all parties to work for the cessation of hostilities and
maintain the ceasefire.
* The time has come for a long term solution to the Israeli – Lebanese
problems.
* While we have been concerned with the Israeli – Lebanese war, we have
neglected the situation in Gaza. The latest United Nations (UN) reports are of
great concern. In Gaza, there has been a sharp decline in the humanitarian
situation confronting 1,4 million people following the fifth week of operation
Summer Rains (in which Palestinians have been killed and 25 Israeli’s injured
in the same period.)
* The United Nations Development Programme (UNDP) estimates that in excess of
US$15,5 million damages have been caused not including the destroyed power
plant and other costs due to sanctions and closing of the crossing
points.
* South Africa’s position remains long term peace and stability in the region
will only be possible if we deal with the major issue such as the
Israeli-Palestinian conflict. The only prospect for peace remains the creation
of a viable state of Palestine and Israel living side by side within secure
borders.
* This remains the only way for relations between governments to improve and
well as people to people relations.
* Analysts are increasingly accepting that the Roadmap is dead. We must now
move towards the final stage i.e. negotiating the creation of two secure
states.

South Africa – Iran Joint Bilateral Commission
* Foreign Affairs Minister Dr Nkosazana Dlamini Zuma and her Iranian
counterpart Foreign Minister Manoucher Motakki will co-chair the 9th South
Africa – Iran Joint Bilateral Commission (SA-Iran JBC) scheduled from Monday –
Tuesday, 21-22 August 2006 at the Presidential Guesthouse in Pretoria.
* This JBC meets bi-annually and looks at issues of political, economic and
social relevance in addition to South relations.
* However, this session of the JBC comes a few days before Iran must respond to
the G-5 proposals.
* There have also been many reports denied by both Iran and Hizbollah that Iran
has been involved in the fuelling the war between Israel and Lebanon. This
meeting will also give the South African side an opportunity to discuss
developments in the region and how to give impetus to the failing peace
process.
* On the economic side, Iran still supplies about 40% of South Africa’s oil
needs.
* Trade however is on the increase. South African annual exports for 2005
amounted to R785,2 million. Annual imports came to R14,3 billion, thus implying
a total negative trade balance of R13,5 billion.

South African exports to Iran-Annual total:
2001: R471,164 million
2002: R372,022 million
2003: R301,412 million
2004: R347,880 million
2005: R785,208 million

South African imports from Iran-Annual total:
2001: R8,841,717 million
2002: R9,667,271 million
2003: R9,286,363 million
2004: R15,222,821 million
2005: R14,324,471 million

This meeting will also have an opportunity to look at addressing this
negative trade balance.
* Many South African companies are however becoming increasingly active in Iran
- SASOL, and MTN has also been awarded a lucrative contract to establish and
operate a second mobile operator license.
* There are many signs that economic relations are on the increase.
* However, as I have always said, this potential economic growth will be linked
to peace and security in the region.

South African Development Community (SADC)
* Senior officials met in Maseru, Lesotho from 11-14 August, the Council of
Ministers will meet from 15-16 August and the Heads of State and Government
from 17-18 August 2006.
* This is a very important session since it must look at revitalising the
implementation of the SADC integration agenda, expediting the implementation of
the Regional Indicative Strategic Development Plan (RISDP) and consider
strategies for consolidating economic development and integration in the
region, also within the framework of SADC being a building block of the African
Union.
* The social and political situation in the region is better than it has been
for many years. The region Southern Africa is projected to expand at a much
faster rate of 4,4% in 2005 compared to its growth rate of 3,3% in 2004. Growth
in South Africa is expected to increase from 2,8% in 2004 to 3,4% in 2005
because of anticipated strong global demand for its products, growth in
tourism, an increase in Foreign Direct Investment (FDI) inflows, expansion in
domestic demand in response to new tax-relief measures and a low interest rate
environment.
* Developments in the oil sector will continue to influence Angola's economic
activity in 2005. The continued rise in oil production is expected to raise
growth to about 15% in 2005 and about 25% in 2006. Furthermore, growth in
services in Botswana, Mauritius and Namibia; an increase in mining sector
activities in Botswana, Mozambique, Namibia and Zambia; agricultural sector
expansion in Mauritius, Mozambique and Zambia; development in tourism activity
in Mauritius and Zambia and donor support in Zambia will be the main factors
that contribute to the expansion of the region's growth in 2005.
* Despite the expected positive performance of most SADC countries, the SADC
region still faces daunting challenges as it aims at accelerating growth,
reducing poverty and attaining the Millennium Development Goals (MDGs) and the
targets set in the RISDP. It is commonly accepted that most people in Southern
Africa live under the poverty line.

* The key driver for development and deeper integration within SADC over the
next 15 years is market integration. This will encompass financial and capital
markets integration and the extension of intra and extra-regional trade.
* SADC's immediate goal is the full implementation of the SADC Free Trade Area
that is envisaged for 2008.The legal instrument for achieving the Free Trade
Agreement (FTA) is the SADC Protocol on Trade. The Trade Protocol entered into
force on 25 January 2000 after the required majority of two thirds of SADC
member states had ratified it. Eleven member states have been implementing the
Trade Protocol since 1 September 2000 in various stages.
* When SADC member states started to implement the Trade Protocol in September
2000, some 45% of all goods traded in SADC were already traded at zero tariffs.
All member states implementing the Trade Protocol follow their individual
tariff phase-down schedules applying the asymmetry principle with South African
Customs Union (SACU) moving fastest and the other countries following more
slowly. With few exceptions (e.g. Malawi, Tanzania, Zambia and Zimbabwe), the
process of the tariff phase-down is generally on track, and it is expected that
by 2008, over 85% of the goods will be at zero tariffs, thus ushering in a FTA
in the region. By 2012, 99% of tariffs will be at zero tariffs. Since January
2006, SADC tariff preferences into SACU are duty free except for sugar, used
clothing and 26 tariff lines in the automotive chapter.
* Intra-regional trade was estimated at about 20% of total trade in 1997. The
overall figure for intra-regional trade stood at roughly 25% by 2003 and is
expected to increase further by the time the FTA is fully implemented. Member
states’ trade shares with SADC vary widely, from a low but increasing 2,1% of
overall trade for Mauritius to up to some 80% for Swaziland. Malawi, Zambia and
Zimbabwe trade 40 and 50% of their overall trade (imports and exports) with
SADC partners.
* South Africa's exports increased from R215 billion in 2001 to R320 billion in
2005 while the region’s contribution was R24 billion in 2001, increasing to R30
billion in the latest year. However, despite the increase in the value of
exports to the region, SADC's share declined from 10,8% to 9,4% over the same
period. Total imports have risen from R215 billion in 2001 to R350 billion in
2005, while imports from SADC rose to R8 billion from R4 billion over the same
period. The regional share was a meagre two percent of the total throughout the
period.
* The stagnation of SADC's share in total imports suggests that the region has
not responded to improved market access in South Africa. South African imports
from SADC are increasing, but commodities drive most of the growth. These
products did not face tariffs before 2000 and therefore, it is unlikely that
their performance improved due to the implementation of the Trade Protocol.
Trade appears to be influenced more by the region’s comparative advantage
rather than improved market access. Another factor that might explain why the
region has not responded to market access incentives could be due to capacity
constraints.
* Intra-regional trade is diversifying slowly but gradually, and more
manufactured goods are now making up a larger share of overall trade in the
region. Major increases in trade have occurred in the textiles, clothing and
sugar sectors, where special trade arrangements in these industry sectors
opened up larger opportunities for trade in the region. Other important
industry groups include agro- and food processing as well as processed base
metals. Intra-regional trade has been growing at a slightly higher rate than
extra-regional trade between 2000 and 2003 indicating that SADC businesses were
able to expand their home markets into the region and utilise more fully the
existing trade potential.
* The RISDP repeatedly highlights the need for more investment on the African
continent, with FDI being a key part of that. Botswana, Lesotho, Namibia and
Swaziland have remained destination countries for South African FDI since 1994,
whilst the rest of the SADC region has become a logical place for expansion. A
defining characteristic of South African investment is its diversity: FDI has
not been confined to natural resource extraction but also the industrial and
services sectors.
* As the following table demonstrates, the bulk of the investment for the
period 1994 to 2004 went to SADC countries:

Angola: R1,766 million
Botswana: R1,095 million
DRC: R17,356 million
Lesotho: R4,086 million
Madagascar: R166 million
Malawi: R2,276 million
Mauritius: R187 million
Mozambique: R20,069 million
Namibia: R4,654 million
Swaziland: R563 million
Tanzania: R3,630 million
Zambia: R2,217 million
Zimbabwe: R3,351 million
Total: R61,042 million

* Summit must also look at preparing for the brainstorming session of New
Partnership for Africa’s Development (NEPAD) Summit to be held in Abuja,
Nigeria 30-31 October 2006. This follows the last African Union Summit during
which it was decided that Heads of State and Government need to do more to
accelerate the implementation of NEPAD. In this regard, SADC must have a
collective response to present to the Summit.
* Summit must also look at the latest decision taken at the African Union (AU)
Summit to set up a committee to finalise the integration of NEPAD into the AU
structures. As you know, there was an extension of 6 months given to complete
this process. The process must now be completed within 6 weeks.
* Much of the Summit will look at the issues of economic integration. Other
issues will include: now that Angola is at peace with itself, and its economic
growth based on its oil and mineral resources have been very good, it must now
make a greater contribution to the region. Summit will also look at the
Democratic Republic of Congo and how to precede post-elections.
* I can make a few comments about the SADC Standby Brigade. The Permanent
Planning Element (PPE) is in place consisting of the Republic of Botswana as a
host to the SADC Headquarters, Angola, the Kingdom of Lesotho and Namibia.
Summit is expected to acknowledge the weaknesses relating to the finalisation
of SADCBRIG Memorandum of Understanding (MOU), standardised operating
procedures and general lack of readiness of the pledged Units.
* On the gender issue, almost half of SADC Member States have surpassed the
previously set target of 30% and are now striving to achieve the new target of
50% within Parliamentary and Cabinet positions.

Questions and answers

Question: Deputy Minister Pahad, you spoke extensively of the economic
integration of SADC. How will this integration affect the free movement of
people especially when we consider the many Zimbabweans who are turned away
from our borders?

Answer: We have signed the Protocol on the Free Movement of People. We are
awaiting ratification from Parliament and other structures. In addition, a few
countries have not ratified this Protocol.

As we move towards a free trade area, etc, a significant element becomes the
free movement of people. This cannot be avoided.

Question: Deputy Minister, will the South African government be doing more
humanitarian work in Lebanon? Can you also comment on the mission by the Gift
of the Givers?

Answer: The South African government is considering what else it can do to
assist the people of Lebanon, but their needs are massive. We are happy that
not only the Gift of the Givers, but other South African aid organisations have
responded positively to the plight of the Lebanese people including the
Marionite Church and others. We have also called on the South African Council
of Churches to assist.

We will meet with humanitarian aid groups in the next week to ascertain how
we can further assist.

Clearly, the developed countries must do more to assist the people of
Lebanon. Current estimates are that entire villages have been destroyed and at
least 80% of Lebanese infrastructure. This will be a massive reconstruction and
development project.

Question: Deputy Minister Pahad, can you comment on the United Cricket
Board’s (UCB) decision following the unrest in Sri Lanka?

Answer: We have been in touch with the UCB. Our mission in Sri Lanka has
also been in touch with them and us at Head Office. Up to the time of this
briefing there was no final decision as the UCB was meeting with security
agencies to determine how their needs would be met.

However the situation in Sri Lanka is deteriorating badly. From witnessing
optimism a few months ago that the ceasefire would hold and movement created,
we are now facing a re-emergence of the darkest days of the conflict in which
civilians are increasingly targeted.

Question: Deputy Minister Pahad, will the South African side urge the
Iranian delegation to accept the G-5 proposal?

Answer: We are not very familiar with the G-5 proposal.

However, the South African position is that we are against the proliferation
of weapons of mass destruction. In fact, we urge all parties with these weapons
to destroy them.

We are also hoping the Iranian delegation will be able to brief us better
regarding the G-5 proposal since their response is expected on the 22 August
2006.
We also continue to maintain that the IAEA Board should exhaust alternatives to
resolving the matter before it is referred to the United Nations Security
Council.

The South African government favours a resolution to the crisis. We hope
that the proposals on 22 August 2006 will be the basis for continued
discussions towards a resolution.

Question: Deputy Minister Pahad, how will the failure of the latest round of
World Trade Organisation Talks affect discussions at the SADC Summit?

Answer: SADC will have to discuss the failure of the latest round of World
Trade Organisation Talks since it affects the region.

South Africa is a member of the G-20. We do believe that we are very close
to resolving the matter. There is just the two outstanding issues from the
United States (US) and European Union (EU) - that of market tariffs and
agricultural subsidies respectively.

We hope that these very powerful forces can look beyond their own interests
and at the international trading system at large and compromise on these
issues, in the interest of all.

Question: Deputy Minister Pahad, if South Africa was called upon to mediate
in the Middle East conflict, what concrete proposals would you suggests? Also,
is South Africa prepared to mediate in this situation?

Answer: I do not believe that South Africa needs to mediate in this
situation. This situation has been there from before we became a democracy.
Besides, there are many plans and agreements on the table – the Oslo Agreement,
the Arab League Plan, United Nations resolutions, etc.

South Africa can only share its experiences of life after political
negotiated settlement. We cannot bring any new plan to the table. We can
however interact to assist the situation through the Non-Aligned Movement, the
G-77 + China, the UN etc.

In addition, we have not been asked to mediate in the conflict – the
Lebanese Prime Minister when he wrote to President Mbeki asked for our support
in the implementation of his seven point plan. This seven point plan is now
mentioned in United Nations Security Council Resolution 1701.

Question: Deputy Minister Pahad, are you satisfied with the election process
in the DRC?

Answer: We have consistently said that this will be one of the most
difficult elections to organise considering the logistical and technical
difficulties and challenges of the country, including the problems with the
printing of ballot papers, the violence in the East, the many candidates
standing for elections, etc.

However, the South African Observer Mission has echoed the sentiments of
many of the other groups, that despite these challenges, the process has gone
well.
The biggest challenge was perhaps that many of the Presidential candidates do
not have a big political following. These candidates, when the SADC delegation
of Foreign and Defence ministers visited the region ahead of elections,
requested that we support their requests for the polls to be postponed.

And, there are one or two candidates with a big following saying that if
they do not receive satisfaction from the process that they will return to
armed struggle. We can only hope that this is just bravado at this stage.

Question: Deputy Minister Pahad, the Mercenary Bill will be finalised in
Parliament today. How do you see this Bill being implemented?

Answer: I am not very sure of all the aspects of this bill. I will be
meeting with the British High Commissioner to discuss this matter further. I
think it would be more useful for you to approach the Department of Defence for
further information.

Question: Deputy Minister Pahad, SABC last week mentioned that President
Mbeki would be visiting Washington for discussions with President Bush. Can you
give us more information?

Answer: The President will be in the USA in September where he will attend
the United Nations General Assembly. Perhaps this planned meeting will be
scheduled to coincide with this.

Question: Deputy Minister Pahad, since there is no way of ensuring that SADC
countries comply with the signed Protocols, how will the region ensure that the
2008 deadline for economic integration be met?

Answer: This is indeed a very important matter – the implementation of
Protocols must indeed be assessed. The change of SADC leadership at the
bureaucratic level has contributed to the delaying of processes. Summit must
also reflect on whether the organisational structures introduced two years ago
require modification since they were perhaps too ambitious.

We must do something drastic – only two or three countries have not given
their products for tariff reduction.
The deadline of 2008 is something towards which we are all working when we will
have a free trade area. Then we should work for a customs union and economic
integration.

Cabinet has instructed that all ministries prepare for the implementation of
SADC programmes – I have always believed that as the strongest power, we must
do more than many of the other countries to assist this process.

It is indeed strange that SADC, which was perceived as a model by many, has
fallen back in ensuring the implementation of its programmes. I do hope that
South Africa will do what it should do in order to ensure that SADC programmes
at all levels will be taken care of.

We need SADC. SADC is as important to us as we are to it.

Question: Deputy Minister Pahad, how are preparations for the
India-Brazil-South Africa (IBSA) Summit? Which issues will be discussed?

Answer: Preparations are well underway. This is the first IBSA Summit and
will be hosted by Brazil on the eve of the Non-Aligned Movement (NAM) Summit in
Havana, Cuba. Brazil is not a member of NAM.

Many of the issues that we deal with on a daily basis will be on the NAM
agenda.

Issued by: Department of Foreign Affairs
15 August 2006