South Africa and Saudi Arabia have agreed to increase total trade between the two countries to a targeted R60 billion within the next five years. This was agreed at the fourth session of the South Africa-Saudi Arabia Joint Economic Commission (JEC), that was held on 28 to 29 April at the Royal Conference Palace in Riyadh, Saudi Arabia. South Africa’s Minister of Trade and Industry, Dr Rob Davies and his Saudi counterpart, Minister Tawfiq Al-Rabiah, co-chaired the JEC.
Minister says that the current total trade between the two countries stood at R34bn in 2011 and this represents an annual growth rate of about 32,6% in just one year. Total trade in 2010 amounted to R26 billion.
‘From the vantage point of the trade balance, South Africa always had a negative trade balance with the Kingdom of Saudi Arabia. This ranged from a deficit of about R23 billion in 2007 when the credit crunch hit to a deficit of R29 billion in 2011. There is no doubt that the level of our bi-lateral trade is far below potential and is also concentrated in a few sectors like oil and gas, raw materials and fruits and vegetables. This point to a need to diversify our baskets of goods traded. More value added and diversified trade will benefit both our countries as it will lead to job creation, which is one of our single biggest challenges at present’, said Davies.
The two countries agreed that the level of investment is far below potential and undertook to work together to explore several initiatives to address the situation.
‘To this end, the launch of the South African – Saudi Arabia Holding (SASAH) as an investment holding company is welcomed, as it will accelerate the development of investment opportunities in the identified sectors to the amount of R10 billion. This joint venture is a creative and practical mechanism by the private sector to look at large scale projects in agriculture, mining and infrastructure’, he added.
The two countries have committed themselves to strengthen relations through closer and focused cooperation in areas such as infrastructure development, agriculture, mining and energy, tourism, arts and culture, transportation, environment, standards, amongst others. It is hoped that these initiatives will elevate bilateral relations to a higher level.
The JEC also resolved to cooperate in promoting handicrafts and introducing the culture of both nations, through the participation of folk groups in events that are held in both countries and establishing cultural weeks.
'It was further agreed to consider supporting the African World Heritage endowment fund and to partner in hosting the opening of the Arab route exhibition at the 36th world heritage meeting in St Petersburg in July 2012'. The Deputy Minister of Department of International Relations and Cooperation, Mr Ebrahim Ebrahim and South African ambassador Sadiq Jaffer, also attended the session.
Enquiries:
Sidwell Medupe (Departmental Spokesperson)
Tel: 012 394 1650
Cell: 079 492 1774
E-mail: MSMedupe@thedti.gov.za
