Remarks by President Cyril Ramaphosa during the South Africa-Finland Business Roundtable during the State Visit by H.E. Sauli Niinistö, President of the Republic of Finland
Your Excellency, President Sauli Niinistö and your delegation,
Minister of Trade, Industry and Competition of the Republic of South Africa, Mr. Ebrahim Patel,
Ministers from the Republic of Finland and South Africa,
Ambassadors,
Representatives of business from Finland and South Africa,
Industry representatives,
Guests,
Ladies and Gentlemen,
Good evening.
It is my pleasure to welcome President Sauli Niinistö and the business delegation from Finland.
I have taken note of the report emanating from the Business Round Table and the tangible recommendations that have been made to deepen trade and investment between our two countries.
This State Visit is timely, with us having just concluded the first phase of a five-year investment target cycle that we embarked upon in 2018.
Over the past 5 years, we mobilised R1,5 trillion of new investment commitments in the South African economy, largely by the private sector.
Despite major challenges and disruptions, including the COVID-19 pandemic and devastating floods on our eastern seaboard, we were able to exceed our initial target and are proud of this.
Having exceeded our initial target of R1,2 trillion we have now set a new target R2 trillion in investment commitments by 2028.
I want to take this opportunity to encourage Finnish companies to participate in this new investment mobilization drive.
At last year’s 4th South Africa Investment Conference, a Finnish company, Huhtamaki pledged R150 million, and we want to see other companies from Finland follow suit.
Finnish companies have a presence in South Africa in the packaging, industrial cranes, metals, digitization, green finance, energy, fleet management and mining equipment sectors, amongst others.
Finnish business can also support Africa’s economic integration and intra-African trade.
This has become a major focus with the coming into operation of the Africa Continental Free Trade Area. The AfCFTA brings together 54 national economies into the world’s largest free trade area.
By February this year 47 countries had ratified the AfCFTA, and we expect to shortly get into the implementation phase.
We have reviewed Finland’s Africa strategy and noted that you intend to double trade with Africa. Furthermore, you are committed to increasing investments from Finnish companies into Africa between 2020 and 2030.
Even though the volume of bilateral trade increased since 2018 South Africa currently has a negative trade balance with Finland.
We are looking for balanced trade in two respects. Firstly, that Finland imports more South African products to address the trade deficit.
Secondly, that more of those products are manufactured articles with high value-addition.
We have also noted in terms of Finland’s Africa strategy at least 50 per cent of the value of Finnfund’s new funding decision are geared towards investments in Africa.
We are ready for a partnership. Our team at InvestSA would be very keen to have discussions with yourselves to see how we can support Finnish companies with projects in South Africa to enable greater levels of funding for Finnfund.
South Africa’s value proposition is the diversity and sophistication of our economy.
I want to focus on five clusters of opportunity this evening.
Firstly, within manufacturing, we see opportunities in sectors such as automotives, steel, machinery, mining equipment, furniture, chemicals and clothing and textiles.
Secondly, the economy needs further investment in transport and logistics ICT and other productive services. Finland has a large ICT ecosystem. We note that Nokia has received the MTN 5G roll out contract. This should be underpinned by more Finnish investment in South Africa’s manufacturing and productive ICT services geared to exports. Nokia should consider ways to include our companies within its local and global component supply-chain.
Thirdly, South Africa is a mining hub, and we welcome opportunities for further partnership. Like I said earlier however, it is important that these partnerships include activities through which we add value to our raw materials, and manufacture more machinery locally.
Fourthly, food production and the expanding fruit and meat industry in South Africa can be a source of food security for Finland.
We are disappointed at the acts of EU protectionism against South African farming products, most recently against our citrus. We are now the world’s second largest exporter of citrus and believe recent decisions by the EU are unfair. We look to you to make the case against rising protectionism in the EU, and in favour of free trade.
Fifthly, the green economy provides opportunities in renewable energy, components for solar and wind power facilities, green hydrogen and battery-storage technologies, as well as electric vehicles.
South Africa is in the grip of an energy crisis. We are implementing a national Energy Action Plan to increase the current supply of energy, and to achieve energy security in the long term.
We are driving reforms in the electricity sector to enable private investment in electricity generation and accelerate the procurement of new generation capacity from solar, wind, gas, and battery storage.
Even as we work to improve the performance and efficiency of our existing coal-fired power stations to address energy-shortages, we remain committed to a just energy transition and to our target of achieving net zero emissions by 2050.
A just transition to a low carbon, climate-resilient, greener economy forms part of South Africa’s global climate change commitments.
We believe that there is alignment between our objectives and Finland’s goals.
As your Africa strategy indicates and I quote:
“At least 60 per cent of the loans and investments within the framework of Finland’s development policy investments will be allocated to Africa between 2020 and 2023. A substantial part of this will support green transition in Africa, as at least 75 per cent of all development policy investments will be allocated to climate funding.”
I urge Finland to work with developing countries to ensure there is a multilateral approach to trade and climate change.
We are concerned by recent unilateral decisions within the EU on the Carbon Border Adjustment Mechanism that will undermine the global consensus that is necessary for successful climate action.
Finally, skills development and entrepreneurship is another critical area in which we can collaborate.
We would be interested in exploring areas of cooperation with Finland to improve access to educational opportunities especially in the field of vocational education and training, and for young people in particular.
With these few words I thank you once again for being here and look forward to a successful outcome of this business forum.
