Minister Dipuo Peters,
David Crane, CEO of NRG Energy;
Jeff Moseley, CEO of the Greater Houston Partnership distinguished guests,
Ladies and gentlemen,
Thank you for hosting us and providing this opportunity to share a few thoughts with you on our goal of further boosting economic and other ties with the United States of America (US).
I am indeed pleased to see a broad spectrum of powerful business leaders of Houston attending this luncheon.
Earlier this morning we had the pleasure of joining the Founder’s Day Convocation of Texas Southern University, during which I was honoured with an honorary doctorate.
We have established a ground breaking partnership in education with the university, one which we would want to develop into a wider collaboration in education hopefully with other universities in the US.
We are very serious about investing in education and skills development in our country and such partnerships contribute to the achievement of those goals.
This interaction is important as we want to see further growth of trade and economic ties between our two countries.
More than 354 Houston companies report doing business with South Africa.
These trade ties are important for deepening not only economic, but also political and social ties with the United States. The environment exists for us to take our economic relations to a higher level.
We believe we have done exceptionally well in only 17 years of attaining freedom.
South Africa has moved from a pariah state to a stable, vibrant constitutional democracy with strong democratic institutions.
As you would be aware, South Africa returned to the global community in the early 1990s after facing decades of economic and political sanctions.
Since the removal of the sanctions, our country has witnessed a rapid change in its political and economic situation.
Due to the economic sanctions and a wave of disinvestments during the late 1980s coupled with the country’s status as practising a policy of governance that was a crime against humanity, it was only in the early 1990s that South Africa began to find its way back into the international arena.
South Africa embraced this new status in the global economy by taking advantage of what the world offered and transformed its economy to become one of the leading investment destinations.
The transformation began with the removal of barriers to trade, the development of deep financial markets as well as developing policies that are conducive for business, while protecting our labour force in line with the Constitution of the Republic.
We are open to foreign investment as a means to drive economic growth, improve international competitiveness, and obtain access to foreign markets for its exports. Virtually all business sectors are open to foreign investors.
You may have noticed that we have spent a few months boosting strengthening ties with China, India, Brazil and other countries.
However, we do not want this move to be viewed as a threat to traditional North-South links and trading patterns. South Africa’s South-South cooperation agenda should not be viewed as one that excludes our traditional partners in the developed North at all.
Africa, Latin America and Asia are new global economic growth points. The US’s consolidation of economic relations with these regions is similar to South Africa’s own cooperation agenda with these regions of the "South".
We want to explore opportunities in the United States more than we have done before. We believe there is room for expansion in our trade relations.
The year 2010 represented the tenth anniversary of the enactment of the Africa Growth and Opportunities Act (AGOA) into law.
The legislation makes provision for the AGOA Forum, which remains the only formal collective platform of engagement between the United States and sub-Saharan Africa to date.
The law therefore is to be commended and encouraged to continue, and means must be assessed to enable to legislation to serve as a catalyst for US investments towards Africa.
Dear friends,
We also see opportunities in the United States’ National Export Initiative (NEI), its developmental dimension as well as its potential impact on trade and investment in Africa.
While the NEI is an initiative of the President of the United States, Excellency Barrack Obama, specifically aimed at doubling United States exports in the next five years so as to boost US jobs and economic growth, we believe it can be utilised to strengthen trade relations between the United States and sub-Saharan Africa trade relations.
We are also of the view that there are some opportunities for Africa in the implementation of these United States objectives. There is potential for a win-win outcome in the implementation of the NEI.
We have identified key areas where we can achieve a mutually beneficial developmental outcome through the NEI.
One of the key implementation measures in the NEI is technical and financial support to US small and medium enterprises, so as to enable them to access international markets.
With an improved business climate in Africa’s economies, we must explore opportunities for joint-venture partnerships between private sector entities on the continent and US private sector, particularly American small, medium and micro-enterprise (SMME).
Partnerships at the level of emerging and small enterprises are the engine of economic growth in Africa.
One of the challenges to partnerships with the private sector in Africa has been the size of our enterprises as compared to global multinational companies. However this challenge can be overcome where there are genuine opportunities.
We are encouraging investments in Africa with good reason.
Numerous studies have confirmed that the rate of return on investments and partnerships in Africa is higher than in any developing region, and that Africa’s economy is currently growing two to three times faster than Economic Co-operation and Development countries.
This bodes well for those US entities that are enterprising enough to look towards Africa for their own growth, not only through merchandise exports, but though actual direct investment and physical presence in African countries.
In South Africa, we stand ready to receive American business and encourage our own companies to explore opportunities in the US.
There are more opportunities to explore in South Africa as well. We believe that our own New Growth Path, adopted last year, will help us achieve our vision for the next ten years.
We have identified a number of economic sectors where there are significant opportunities for expansion and investment.
These are infrastructure development, agriculture, mining and beneficiation, manufacturing, the green economy and tourism.
With regards to beneficiation, South Africa plans to use its position as the current convener of the Council of African Ministers of Industry to develop a common continental framework for extracting greater value from the prevailing minerals boom.
The rise in the demand for natural resources, which has been accompanied by strong commodity price increases, is already attracting foreign investors.
We want to use this upturn to stimulate greater investment into minerals beneficiation across the continent.
We have already secured a declaratory commitment from China for minerals beneficiation at source.
The commitment forms part of the comprehensive strategic partnership agreement that I signed with President Hu Jintao during my State visit to Beijing in August last year.
What we are now working towards, is a framework for extracting more value from these mineral products and exporting higher value-added products to other countries, including China.
Let me add that complementing South Africa’s potential as an investment destination, is the well-established financial services. South Africa boasts deep and liquid capital markets, thus making access easy for businesses to raise capital.
Ladies and gentlemen,
South African companies also continue to explore opportunities beyond our shores.
In this regard, I am very pleased with the recent announcement that Sasol, South Africa’s integrated energy company, has chosen the State of Louisiana as the location for a planned gas-to-liquids facility.
The project is said to be the first plant in the United States to produce high-quality gas-to-liquids transportation fuels and other products.
Sasol will embark on a feasibility study to evaluate the viability of a gas-to-liquids venture in Lake Charles, over the next 18 months.
The feasibility study will consider two options of two million tons per annum and a four million tons per annum facility costing up to 10 billion US dollars.
This investment is one good example of the economic potential between our two countries. I wish the project all the success.
Dear friends,
This business session has brought together people who are committed to the development of the continent and decision makers who clearly recognise the tremendous opportunities that exist on our continent.
This is only the beginning of our partnership. The next step is for you to visit South Africa to explore the opportunities we have referred to and to generally enjoy the beauty of country and its people.
Ladies and gentlemen,
Allow me to express my gratitude to the Greater Houston Partnership for hosting this luncheon and business forum and also to all who have made our visit a success.
We look forward to more interaction and success.
I thank you.
