Protocol
On behalf of the government of the province of KwaZulu-Natal and the Premier of our province, Dr ZL Mkhize, we wish to express our profound gratitude to all of you for heeding our call andmeeting with us today to chart a collective way as provinces who share boundaries on how we cancollaborate in developing our economies and improving the lot of our people.
We meet at an exciting time in the life of our country when we have just successfully hosted the biggest sporting spectacle in the world, the 2010 FIFA Soccer World Cup. Indeed, one of the profound outcomes of the world cup is that it has re-ignited the self belief of ourselves as South Africans that if we set our minds on doing something, we do it and do it well.
Because we have been bestowed with the privilege of leading, we have a responsibility to harness this optimism and self-belief in order to tackle some tasks that we may have felt were close to being insurmountable.
The purpose of today's meeting is for KwaZulu-Natal to share with our sister provinces our outlook when it comes to economic development; suggest the trajectory that all of us as four provinces should consider and after frank and open deliberations, adopt a programme of action to assist us in attaining our shared objectives.
We feel that fate has opened a rare window of opportunity for us to ride the wave of our world cup success and indeed ensure that we utilise the lessons and the advantages identified to attain our long-term strategic economic development objectives.
A speaker, at a function, a few days ago, stated that our country only has two years to exploit the comparative advantages provided by the world cup. After this period, the "normal" world order will resume and, as part of the developing world, we will go back to being our normal selves having to struggle very hard for what will come easy over the next two years.
In a nutshell, we dare not waste time but need to immerse ourselves in the task of building a sustainable economy that ensures long-term growth which benefits all of our people.
As we are all aware, the world has become a global village. Progressive and successful regions and nations around the world have adopted the concept of partnerships, cooperation, collaboration and collectivism in approach, as their credo for survival.
In Europe we have the European Union, in Asia we have the Association of Southeast Asian Nations (ASEAN) and in Africa we have, among others, the Southern African Development Community (SADC) and the Economic Community Of West African States (ECOWAS).
In our case as part of SADC, we have observed how this body, formed in 1980, has grown in stature to unite the countries mainly of Sub-Saharan Africa. This has, in particular, strengthened our voice in multilateral forums and we have been able, as a region, to box way above our weight.
As colleagues are aware SADC has, among other things, declared that by year 2015 we would have a common market and that by year 2018 we would have a single currency for all 14 member states. The key imperative in this regard, is the integration of economies of the region for sustainable development.
These proposed developments mean that while the opportunities for trade and economic advancement will increase, it is only those sub-regions within the SADC region, who have workable collaborations and partnerships that will be able to take advantage of the promises of economic integration. The years 2015 and 2018 are a stone’s throw away.
We need to act and act now to take advantage of regional economic integration that will soon happen. KwaZulu-Natal, like our other sister provinces, has been hard at work through our agencies like Trade and Investment KwaZulu-Natal, urging in particular, international investors to come and invest and set up their operations in our province. It is the work that, over the past years, has yielded positive results with multi million rand investments attracted into our province.
However, the international trajectory towards regionally integrated economies including SADC, as well as our own shared objective of accelerated economic growth for the benefit of all our people, means that KwaZulu-Natal cannot afford to be an island.
We need partnerships with our sister provinces. These partnerships are not informed by a big-brother approach but by practical demands and realities of our economies.
KwaZulu-Natal is now an undisputed logistics hub of our country and our region. Indeed, we are a gateway to the rest of the African continent and the world. I am sure that colleagues are aware of the two mainstays of our logistics infrastructure in the form of the Durban and Richards Bay harbours.
The Durban harbour is the biggest and busiest port in Africa as it handles more than 4 500 ships annually with a gross tonnage of 114 723 266. Richards Bay as the deepest port on the continent is still only 39 percent developed, which implies massive investment opportunities in this fast industrialising economic node on the north coast.
This year we added a critical component to our already impressive logistics infrastructure with the construction of the Dube Trade Port with the country's newest airport, King Shaka International as an anchor business besides other operations such as the cyber port, cargo terminal, trade and agri-zones.
The two harbours, the Dube Trade Port and King Shaka International Airport all provide an advantage for all those who want to expand their trade with sub-Saharan Africa and the Oceana Rim countries as well as other international trade destinations. This mix, critically, presents a diverse and cost-effective way of moving goods around the world.
In this regard and in the spirit of economic integration, we have decided to invite you, as provinces who share boundaries with us, to be the first to take a bite at the cherry. We have already been approached by two international companies that want to set up their plants in this province and who would, obviously, have to source their materials both from us and our sister provinces.
The one is a Swedish enterprise manufacturing sheep-skin based products. The initial demand from this company is that we provide them with 300 000 pieces of sheep skin on a monthly basis.
KwaZulu-Natal alone cannot honour this commercial transaction. That is why we have met with you in order see how we can collaborate in meeting this demand.
We must say that ours is not a narrow view where we only look at one sheepskin that has been sold, but ours is to explore among other things, the scaling up of sheep farming that our provinces will have to embark on; the growth in the number of people that will be employed in the whole value chain; the fact that those skins will have to be transported from other provinces to the plant as well as the finished products that will either have to be shipped from or flown from this province to various world market destinations.
In our interactions with other companies from the United Arab Emirates and the Middle East, we have also received requests for the supply of fresh agricultural produce. Again, there are vegetables that, because of our climates, we can grow in our province and others that can be cultivated by our sister provinces. Both the issues of specialisation and scale and scope, dictate that other provinces must have piece of the pie.
In this regard, the Dube Trade Port, because of its strategic ability to handle time-sensitive products, becomes the natural choice for the transportation of these export goods.
In a paper prepared by the University of KwaZulu-Natal's School of Development Studies, an argument is advanced which states: "Time costs are important for the trade of all goods, but its impact is greater on manufacturing goods. Therefore, for exporters to compete internationally in the higher value added segments, instantaneous rapid access to foreign buyers, through airfreight and an e-commerce platform, is required. Also, rapid access to foreign market is a prerequisite to the integration of a country/region into international vertical production networks or value chains".
Therefore, the Dube Trade Port is a boon not only to the province of KwaZulu-Natal but to our sister provinces as well as it provides an opportunity for them to utilise it in exporting goods, thus boosting the economies of our sister provinces and our country.
We have also noticed that all of us specialise in different sectors of the economy. Indeed, agriculture remains one of our strongest bets as provinces. We believe that if we collaborate and share intelligence on international market demands, we can contribute meaningfully in making the agricultural sector one of the most lucrative in our country and our region.
However, this multi-modal transport and logistics infrastructure is not an end on its own but a means to an end. We need to identify other sectors which can ensure that as a family of provinces we have a balanced economy that competently caters for all sectors. Of course, the advantages attached to these proposed SADC developments far outweigh the disadvantages that might exist.
Successful countries and regions are those that work very hard at minimising potential threats to their economies while taking full advantage of opportunities promised by such developments.
It is therefore, because of both the current and future challenges and opportunities that we convened this session. We move from a premise that when it comes to trade, this cannot be inhibited by the geographical demarcations while we share common objectives that know no borders.
I am convinced that all of us have signed agreements with sister regions or provinces elsewhere in the world but, while we have cooperated amongst ourselves as provinces, these have not been formal arrangements where there are clear cut terms of engagement as well as agreed upon targets.
Our proposal as the Province of KwaZulu-Natal is that charity begins at home and, as such, we should have horizontal collaboration and partnership in areas of mutual interest for a shared growth which will yield long-term spin offs for the people of our country. The Dube Trade Port provides but one critical platform for the cementing of these collaborations.
I thank you.
Source: Department of Economic Development and Tourism, KwaZulu-Natal Provincial Government
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