S Ndebele: South African Trade and Investment Conference

29 October 2007

Programme director
Honourable Deputy President, Ms Phumzile Mlambo-Ngcuka
Deputy Minister for Trade and Industry, Ms Elizabeth Thabethe
Finance and Economic Development MEC, Dr Z L Mkhize
MECs from other provinces
EThekwini Municipality Deputy Mayor, Councillor Logie Naidoo
Honourable Judge La June Thomas Langa
Chair of the Common Councils Community
Consul-Generals
Ambassadors
Distinguished guests
Members of the media present
Ladies and gentlemen:

Introduction

I am very honoured to be part of this very important conference and
exhibition which seeks to highlight the investment potential that this province
and country has. The conference also provides us with a platform to continue
forging partnerships in order to grow our economy and increase the prospects
for creating a better future for all. This conference and exhibition comes at a
time when our economy nationally and provincially is performing well above
expectations.

We are also buoyed psychologically by our country's victory by clinching
both the Webb Ellis Rugby Cup and the Council for Southern African Football
Associations (Cosafa) Cup in just one week. This goes to show what partnership
and team effort can achieve.

Programme director, our provincial government has on many occasions spoken
about the significant prospects which exist for internationally-based companies
to co-operate with South African companies. Our provincial government has
prepared a comprehensive strategy for trade reform and investment for the
purpose of accelerating economic growth in this region.

As part of this reform we have identified certain sectors for growth and
investment. We have also singled out major strategic infrastructure so that
they are in a position for development and for fresh investment.

These public sector and private investments are necessary if we are to up
our economic growth and maintain it at levels which are sufficient for the
creation of jobs and the eradication of poverty.

Developmental province

We have agreed that a developmental state is an interventionist state that
is characterised by the following features:

* It is a state which stimulates growth through redistribution and
broadening participation in the economy.
* It uses its resources wisely to provide social safety nets to the poor and
vulnerable, while ensuring that these safety nets are sustainable over time and
do not trap people on that level.
* It must have a commitment to provide basic services to the general population
for the improvement of the quality of life.
* It creates a conducive environment for citizens to take advantage of
opportunities for their own development.
* A developmental state is one which establishes clear social and economic
goals to guide development.

We are really buoyed by the fact that at the beginning of this year it was
clear we had made significant progress towards economic development. Some of
our programmes aimed at fighting poverty, creating jobs, and promoting social
inclusion and equality are beginning to bear fruit.

* The Gross Domestic Product per region (GDP-R) of the province of
KwaZulu-Natal is now the second largest in the country after Gauteng.
* The GDP-R growth rate rose over five fold from 1 percent in 1999 to 5,3
percent in 2005. This trend suggests that the provincial economy has the
potential to reach a 10 percent growth rate by the year 2014.
* Our provincial government has managed to reduce the unemployment rate from
36,3 percent in 2003 to 29,9 percent in 2006.
* According to Global Insight, the percentage of people in poverty in this
province (poverty rate) decreased from 54 percent in 2004 to 51,9 percent in
2005.
* The literacy rate in this province has improved to 88,6 percent.

Progress against poverty

Cabinet noted in July this year that with regard to social insurance, 3,2
percent of gross domestic product (GDP) is going to social grants with 12,7
million beneficiaries. Free basic services now reach 74 percent of the
population. By April 2007 access to water had increased from 59 percent of
households in 1994 to 86 percent and access to sanitation increased to 71
percent from 50 percent in 1994. Nationally, free healthcare is being provided
to children under six years of age, pregnant and lactating women and to people
with disabilities.

In this province, we have built 1 600 clinics or upgraded them since 1995
and 11 new hospitals have been built since 1998. The schools nutrition
programme is reaching millions of learners in our schools and the no school fee
policy is being implemented with over half our schools now in this category.
Programmes to address asset poverty include the delivery of 2,3 million housing
units since 1994.

While welcoming these advances as consequences of government interventions,
it was the considered view of the Lekgotla that the fight against poverty
cannot be left to government alone. The scale and the nature of the poverty
challenge requires a strong partnership between government, business, labour,
and civil society and the mobilisation of society as a whole.

By 2010 every household in KZN will have water within 200 metres as well as
proper sanitation. By 2012 every household in the province will have
electricity. The 2010 Soccer World Cup will also bring numerous benefits to the
province. We are certain that there are numerous opportunities in the build-up
towards this football spectacle.

Foreign investment

Globalising economy nationally, government has continued to build strategic
alliances in support of industrial policy and establishing a link between these
alliances with the strategic sectors of our economy. These partners include the
Southern African Development Community (SADC), European Union (EU), the
Americans and the emerging markets such as Brazil and India. As a country we
are also paying special attention to strengthening links with countries
including Brazil, Russia, India and China, the Gulf States and Latin American
Countries.

Globalisation is clearly a complex process that South Africa cannot ignore
or avoid. South Africa depends on its relationship with the world economy for
about 50 percent of its Gross Domestic Product (GDP), thus the country has to
engage proactively with the international community. The advent of
globalisation has brought with it, extreme competitive pressures from other
countries, for the same limited resources, namely Foreign Direct Investment and
Official Developmental Assistance.

In KwaZulu-Natal, we have established relations across the world from Asia
to Europe and our continent. We will continue to strengthen these relationships
with our partners and friends during and after this conference because we
believe that our common interests can only be served through equal partnerships
cemented over time and shared experience. In line with South Africa's foreign
policy, KwaZulu-Natal international relations strategy is strongly focused on a
well co-coordinated economic diplomacy.

Asset poverty

Asset poverty is universally acknowledged as a key impediment in the way of
underdevelopment. For this reason, the New Partnership for Africa's Development
(Nepad) has identified infrastructure development as integral to poverty
alleviation and economic growth. Individual assets such as land and houses, and
public assets like roads infrastructure are crucial to the accumulation of
wealth and attracting investment into our communities and country.

Sustained growth is seen in the trucks and trains which criss-cross our
countryside, but it is also seen in our ability to attract investment into huge
projects and in the extent to which we are able to stimulate domestic fixed
investment and encourage capital formation. Now is the time to translate into
action what we were talking about all these years.

Government investment in infrastructure

The R6,8 billion Dube TradePort and the new international airport in Durban
is steadily progressing and is due to be completed by the end of June 2009.
Billions of rands will be invested over 10 years to widen the mouth at the
Durban harbour. Hundreds of millions of rand are being spent on the upgrading
of major transport corridors in the province. The R350 million P700 Corridor
from Richards Bay to Ulundi is now under construction, as is the R300 million
on the P577 from Mtubatuba to Hlabisa and Nongoma. These projects alone, total
in excess of R7 billion.

On completion, the Dube TradePort alone will contribute R12,4 billion to the
economy and will create thousands of new permanent jobs. These investments
indicate the confidence and commitment that this government has in developing
KwaZulu-Natal. Never in the history of this province has there been such a huge
injection of new money into our infrastructure over a period of eighteen
months.

We should hasten to say, however, that this bold initiative by government
needs to be reciprocated by the private sector as our partners in development.
This is a challenge we as government want to pose as we deliberate in this very
important conference.

Conclusion

In conclusion, let me say it is impossible to conceive of a fully developed
economic state if it adopts an internal outlook. The approach of insularity,
especially in the context of a globalised world, flies in the face of reality.
No province or country can live a solitary existence; no country can survive
without friends whose interests are closely interrelated and interlinked in a
circle of co-operation and collaboration that is the world today.

Together we will eradicate poverty; together we will create jobs and build a
better world, a better tomorrow for all our people.

May I also take this opportunity to wish you well over the days of this
conference and exhibition.

Masisukume Sakhe!

Issued by: Office of the Premier, KwaZulu-Natal Provincial Government
29 October 2007