Programme Director,
Honourable South African Ambassador to the Federal Republic of Germany, Rev Makhenkesi Stofile,
Chief Executive Officer of German African Business Association, Mr Christoph KannengieBer,
Chief Executive Officer of Trade & Investment KZN, Mr Zamo Gwala,
Members of the German and KwaZulu-Natal Business Communities,
Distinguished guests,
All protocols observed.
First I wish to start by expressing our sincere appreciation for the work done by Afrika-Verein working together with our entity, the Trade and Investment KwaZulu-Natal, in organising this important trip which we believe will be rated as a success.
Moreover, it’s our honour also to extend our gratitude to the South African diplomatic mission for ensuring that our arrival and stay in Germany has been without hiccups – and especially the Consular-General Mrs Mathula Nkosi who on the first day down in Stuttgart received us with warm hands to ensure that all members of the delegation felt home away from home. We were also well received by various organisations and individuals that we had arranged business engagements with.
The message that featured prominently in our interaction with our German counterparts either in government or business was that KwaZulu-Natal means business! We are delighted that this was reciprocated with same sentiments by the Germans as they had illustrated their desire to actively get involved in exploring investment, joint venture and partnership opportunities that would mutually benefit our peoples.
What was interesting was that Germany is not new to South Africa as it has numerous investments in various sectors of our economy and in turn our country exports a wide range of products to the Europe’s giant economy.
With KwaZulu-Natal now shedding its former status as a periphery economy – actively carving its niche among the top league of trading regions in the world, there could be no suitable partner than Germany that boasts an incredible record of business acumen at global level.
The record speaks for itself as we were briefed that in the most recent time Germany has been able to attract more than 330 businesses in a world that is gasping for investment opportunities following the global financial crisis, especially here in Europe.
Spurred to action by recent promulgation of the nation’s socio-economic blue-print the National Development Plan that seeks to transform South Africa into a prosperous nation we are determined to broaden our trade cooperation with the rest of the world.
Despite the significant strides that we have made over the past nineteen years of our young democracy our country is still a nation of contrasts – with the hugely affluent communities, mainly in urban areas enjoying First World lifestyle while predominantly rural or township citizens are still languishing in poverty – a familiar Third
World experience that we are working very hard as government, business and civil society organisations to reverse. We are mindful of the implications if socio-economic disparities if left unattended hence we are very much intolerant of any form of inequities that could help ferment undemocratic values.
Tapping on the German experience, we believe we could accelerate the process towards a genuine social justice for all our citizens. Having formulated the NDP which is our national compass towards an equitable and sustainably stable democracy on the African continent, we have also reciprocated this plan with the provincial version, the KwaZulu-Natal Provincial Growth & Development Plan which is a product of intense consultation amongst all stakeholders in the province’s economy.
These two visionary and complementary documents are expected to serve as reliable platforms to boost the investor confidence as they illustrate our national and provincial desire to locate ourselves as a nation amongst effective and serious trading nations of the world.
The PGDP mainly reflects the kind of economic sectors we want to concentrate on in the process of unleashing business and employment opportunities that are up for the taking by both local and foreign investors.
Located on the eastern sea-board of our country, KwaZulu-Natal is strategically located to provide impetus for any type of business – either export or import oriented as we are blessed with two highly developed ports in Durban and Richards Bay that both are also earmarked for massive upgrading to meet the ever rising economic imperatives.
Meanwhile, the increasing volumes of inbound and outbound cargo at the Durban facility has led to government’s commitment towards port expansion – with the old Durban International Airport site being transformed into a dug-up harbour. Currently Durban port receives between sixty and eighty percent of the country’s cargo.
This multi-billion rand investment would trigger a wide range of business opportunities during construction and for long term business operations that would require active involvement by both local and international entrepreneurs. Germany business organisations are being invited to seize these investment opportunities.
We have numerous sectors that we believe made KwaZulu-Natal and ideal location to do business. In our engagement with government and business in Stuttgart we revealed that amongst business sectors that would feature prominently is automotive as we want to grow the vehicular economy in our province through the establishment of a highly developed Automotive Components Supplier Park around the proposed extend harbour.
Though the Japanese car manufacturer, Toyota is located in Durban, we are envisaging a park that would cater for various car manufacturers as the country has become a hive for diverse types of vehicles. With an illustrious history of designing, engineering and manufacturing quality cars, we are hopeful that Germany with consider investing in the sector very seriously.
In recent years, between 2003 and 2012, Germany’s direct investment in sectors such as automotive, chemicals and engineering is estimated at R37, 66 billion. This was further enhanced by more than 71 Germany companies that invested in our country in the same period to create more than 18 thousand jobs.
Besides Durban, the province offers many business options which we have decided to package along the spatial development concept called Special Economic Zones that promote decentralisation of industrial development where each district or region of our province is identified with specific industrial sectors that offer significant comparative and competitive advantages.
While the SEZ approach is a national initiative directed at promoting economic activity in all parts of the country, in our province we have coined it District Industrial Hubs since we want each of the eleven districts that comprises KwaZulu-Natal to play an active role in the acceleration of socio-economic transformation.
For instance even the most remote districts that have agriculture and mining as their potential economic activity would be incentivised through the packaging of their investment qualities and marketed to potential investors interested in specific sectors.
We therefore implore business people attending this gathering to use this interactive session to seek more information on the investment opportunities available in the province, especially in the districts.
The advent of modern telecommunication, transport logistics, favourable climatic conditions, skilled labour and diverse cultural trajectory, make KwaZulu-Natal an attractive proposition for serious traders that appreciate the advantages offered by borderless trade amongst nations of the world.
Besides business options such as agribusiness, automotive, manufacturing, petro-chemical, mining, clothing & textiles and ICT, the province is making strides in positioning maritime and green economic sectors as key contributors to its industrial advancement.
We have recently enacted the Integrated Provincial Maritime Industry Strategy which we intend to use as a reference point for broadening the business scope for the maritime industry in our province, especially that we are a coastal province.
The strategy focuses on diverse sub-sectors of this business that include ship building and repairs, cruise tourism and other multiple allied businesses in the sea-born economy and the prospect of port expansion has bolster our resolve to make maritime a career and business of choice.
Germany experience in this sector and willingness to consider investment in the promotion of maritime economy in our province would be appreciated. Meanwhile another business area that is becoming a global phenomenon is renewable energy.
Germany, we are told is taking a keen interest in this green economy where the country’s prowess in engineering is now directed at devising solutions that could serve planet earth from catastrophic incidents such as environmental denigration due to in the main industrial green-house emissions.
Having hosted UN sponsored COP17 Summit in Durban soon after the 2010 FIFA World Cup, we have acknowledged the importance of sustainable industrial development hence as province we have developed the Green Economy Strategy which has been the product of interactive engagement with various role players in our economy that included government, organised business, labour and indeed institutions of learning.
The latter has been instrumental in researching about the pros and cons of migrating from `Brown Economy’ to Green Economy which created a healthy debate on the implications of embracing environmentally friendly economic practices as opposed to profit-only driven economic pursuits.
With KwaZulu-Natal being a developing economy, we are conscious of the significance of industrial development with a human face where productivity is balanced with environmental protection.
Renewable energy in the form of wind and solar generated electricity supplies is now our key focus and we are grateful that Germany has partnered with us in this mission – and by taping on their experience we are confident that KwaZulu-Natal will become the bench-mark for the activation of renewable energy industry in the region.
The sporadic power disruptions that become familiar around 2008, threatening the 2010 FIFA World Cup have inspired us to invest in this form of energy as the nation’s power utility Eskom were struggling to meet the growing demand for electricity as our economy continues to expand incongruent with the level of energy supplies at our disposal.
Notwithstanding the fact that we are aware that converting to green economic practices couldn’t be a smooth undertaking considering massive investments that had been made over the years of industrialisation. But we are nevertheless optimistic that unselfish sacrifices made today could be the best move to avoid going to history as a generation that was so obsessed with making profit at the expense of environmental protection for the benefit of future generations.
In KwaZulu-Natal we are therefore grateful that through partnership we have started driving our economy towards the right direction. The establishment of RED Hub KwaZulu-Natal, which is a multiple stakeholder project that includes the provincial government, eThekwini and Ilembe Municipalities, is indicative of our commitment to green economy that has to be powered in the main through renewable sources of electricity.
Already, various studies have indicated that though the transition to fully fledged green economy could be costly in the short term, but the future is expected to be brighter and sustainable with the introduction of renewable energy.
This is because the renewable energy sector would trigger other subsectors that would include manufacturing of solar panels, wind turbines, hydro-power generation and recycled waste products. Meanwhile, global investment in the renewable energy is estimated to have increased by 17% to reach $257 billion by 2011 which considering the growing interest in this sector, this figure could now be up by significant percentages.
Despite limited resources to fast-track the development of renewable energy supplies, developing economies are said to be nevertheless making a mark at 35% of the market share compared to the 65% of the developed world in terms of adopting alternative power sources.
Amid reluctance by some advanced economies to adopt clean industrial development, America and China are reported to be gradually migrating to renewable energy and India are also contributing handsomely to renewable energy market that increased by almost 62% that translated into $12 billion in recent years.
As you would acknowledge, KwaZulu-Natal boasts an array of business options in its diverse portfolio of economic sectors in addition to renewable energy. While in recent years South Africa became a member of the powerful block of developing nations, BRICS which emphasises on growing trade amongst member states, we are mindful of the importance of our traditional economic partners in Europe with respect to maintaining strong trade linkages.
We therefore want to reiterate our ambition to elevate our trade with Europe’s largest economy, Germany, which as we all know is one of our leading trading partners in the world – with an estimated 6.8 billion euro worth of German goods being exported to South Africa compared to the investment of 4.3 billion euro worth of South African exports to Germany.
It’s therefore our desire and intention to broaden our trade with Germany to ensure we balance our trade exchanges. As stated above, the sectors that constitute KwaZulu-Natal’s economy have potential to elevate our exports to this country for mutual benefit of our people.
We are delighted for instance that the multi-sectoral agreement that was signed by the Province of KwaZulu-Natal and Baden-Wurttemberg in 2005 would be reviewed collectively to ensure its implementation.
It’s our duty as governments that we enter into these contractual arrangements to help create space for our business people to begin forging business partnerships and joint ventures that would influence the growth of our economies.
Such collaborative agreements wouldn’t only benefit our province and some German states, but we see them as essential ingredients to attract investment attention that could have spill-over effects beyond state or provincial boundaries to cover our respective national and regional confines.
This implies that with the growing regionalisation of our economies, German investment in KwaZulu-Natal could impact on the broader market of 52 million South African and 250 million SADC citizens. More details on the investment opportunities in our province, Trade & Investment KwaZulu-Natal which of course facilitated this engagement in partnership with Afrika-Verein would be at hand to assist those wishing to gain more insight on the various economic sectors that make our province tick.
It’s worth reminding all of us that at least people of German descent have been at the centre of KwaZulu-Natal’s socio-cultural and economic development as we have a sizeable German community with its considerable influence on various economic sectors in our province.
When driving through the streets of New Germany in Pinetown, or traversing the tranquil farmland valleys of New Hanover in the midlands, you will undoubtedly witness the visible vestiges of German culture, which has over the years been enmeshed with other cultures that make KwaZulu-Natal a world in one.
As we vigorously promote economic ties with other nations, this could be at times laborious because of cultural differences. However, based on the historical connectivity with German people, KwaZulu-Natal should be a natural option for German entrepreneurs to invest in our province as this should be a familiar territory for them to quickly adapt to new business environment. Indeed our people have complementary attributes that need to be exploited for collective gains.
Generally, Germans are known for working hard for their Deutsch-marks and South Africans too tend to take their business seriously. Blending the Germans’ hard working ethos with our own sense of seriousness and responsibility in what we do, we are confident this relationship we are currently moulding isworth a talk and action.
We are also appreciative of Germany’s contribution to our tourism and hospitality industry, as tourism flows from Germany to South Africa increased by more than 12% last year. This is not that surprising as we have elucidated that Germans have long history of connectivity with South Africa which has to be harnessed with our collective intentions to grow our trade partnerships.
We are indeed valuing this partnership because is also offering our business people opportunities beyond our respective territorial borders up to the Baltic regions and across Southern Africa. We want to assure you that KwaZulu-Natal is your strategic partner, with all the qualities of a real springboard to trek into rest of Southern Africa and the African continent as a whole.
Options are immense in small, medium and large business operations and as government of KwaZulu-Natal we have no hesitation to declare our province as the best location for Germans to do business. We therefore urge business people from both side to use this interactive session to empower themselves with information on available business and investment opportunities available in their respective countries.
We want to see partnerships and joint ventures emerging through various sectors that constitute our respective economies. In KwaZulu-Natal as said earlier on we are ready to do business with you and it’s now our duty as governments to facilitate trade amongst our people by transforming trade agreements into practical economic activities that mutually benefit our citizens and our continental economies.
I thank you!
