P Mlambo-Ngcuka: China-SA Business Co-operation Forum

22 June 2006

Premier of the People's Republic of China, Mr Wen Jiabao
Minister of Foreign Affairs of the People's Republic of China, Mr Li
Zhaoxing
Minister of Commerce of the People's Republic of China, Mr Bo Xilai
Minister of Trade and Industry of the Republic of South Africa, Mr Mandisi
Mpahlwa
Ministers and members of the official delegation from China
Deputy Minister of Foreign Affairs of the Republic of South Africa, Mr Aziz
Pahad
Deputy Minister of Environmental Affairs and Tourism: Ms Rejoice
Mabudafhasi
Members of the Portfolio Committee of Foreign Affairs
Members of the Portfolio Committee of Trade and Industry
Members of the National Assembly
Distinguished members of the business community and academia of China and South
Africa
Ladies and gentlemen

It is a great pleasure for me to be able to address you here in the fairest
Cape on the occasion of the official visit by China's Premier Wen Jiabao to
South Africa. Even before the establishment of the diplomatic relations in
1998, China had been an important friend to South Africa, through its support
of the international fight to end apartheid.

Since 1998, China and South Africa have successfully deepened our
friendship, our co-operation in the multinational arena as we both strive
towards a more equitable global playing field, and bilaterally through
intensive exchanges of visits, exchanges of views on issues of common interest,
and engaging each other on ways to best enhance our relationship in order to
further our political goals and the economic development of both our
countries.

We have done this guided by the spirit, in many ways and words of Mao Tse
Tung when he said: "Let a hundred flowers blossom, let a hundred schools of
thought contend."

Our constitution adopted in 1996, and which we have just celebrated its 10th
anniversary this year is based on the vision that all people are equal and
should enjoy human rights. Such principles are firmly embedded in our
constitution and are guaranteed.

It is a constitution that respects international protocols and the
sovereignty of nations and non-interference in the affairs of other nations, it
also allows us to trade freely and enter into bilateral relations and
agreements with other countries to promote free trade and investments. It is on
that basis that we have entered into agreements with other nations and the
People's Republic of China.

Geographic distance has become increasingly meaningless in this modern world
of ours and the imperatives of globalisation means that we continually have to
deepen our engagement as friends to jointly address the challenges and explore
the opportunities that we encounter.

We appreciate the most recent positive development in the strengthening of
ties between our two countries in the form of undertakings to further improve
the friendly relationship as well as Economic and Technological
cooperation.

South Africa has long admired China's economic development and achievements.
It seems the world has suddenly woken up to the phenomenon that is China, and
is only now starting to take notice. With decades of sustained economic growth
of around eight percent, China is a global economic force to be reckoned
with.

Therein lies our challenge: How do we ensure that all our needs are met in a
way that ensures a mutually beneficial outcome? The synergies are undeniably
there. But it requires effort and continuous dialogue to identify these. Many
of those required to identify the opportunities are here today: business
leaders, academics, government.

All of us have to apply our minds very earnestly to successfully benefit
from the goodwill and friendship between South Africa and China. Some work has
already begun. Businesses, particularly in the resources and services fields
have established solid co-operation with investments of R 1 billion in each
other's economies.

Although South African companies have currently invested more in China than
Chinese companies have in South Africa, I believe that through forums such as
these and others to follow, this trend will quickly be reversed.

South Africa is a beautiful country of opportunity. We have established
frameworks which are conducive to business; we have energetic and eager people
committed to achieving our economic development goals and redressing the
imbalances of the past.

We are a government that actively promotes this entrepreneurial spirit, and
continually works towards unlocking the potential that is undeniably here. And
we welcome smart partners that recognise this and have the ability to help us
achieve our lofty goals.

Our goals certainly are ambitious but achievable. To ensure that we are
successful, the government has embarked on the Accelerated and Shared Growth
Initiative for South Africa known as (AsgiSA).

We have done so at a time when the South African economy is experiencing
record levels of consumer and business confidence underpinned by low inflation,
subdued interest rates, and the lowest budget deficit in decades. This creates
new opportunities for decisive government intervention to roll back poverty and
unemployment.

The performance of the economy in the past two years suggests that higher
rates of growth and employment creation are possible and for that we can use
all the help and cooperation from yourselves and other friendly countries.

Complimented by other measures, this growth would enable us to at least
halve the proportion of our people living in poverty and to achieve on the
Millennium Development Goals (MDGs).

Industrial and trade policy, skills programmes to enhance rapid skills
development and broad-based development together with a marked shift in the
structure of investment towards labour-absorbing sectors are part of our
strategy.

AsgiSA will enhance and fast-track our existing strategies on redressing the
inequalities of the past and existing imbalances through broad-based black
economic empowerment and addressing the critical skills shortage and education
needs of our country.

We have identified those priority sectors that offer significant potential
in terms of shared and accelerated growth. High on the list is Tourism and
Business Process Outsourcing, followed by Agriculture and Agro-processing.

Others are chemicals, minerals beneficiation and capital goods, creative
industries such as crafts, film and television content and music, clothing and
textiles, durable consumer goods, and wood, pulp and paper.

In these priority sectors I believe it is possible for the Chinese
enterprises to identify a niche for themselves, which will benefit South Africa
and China. You have the skills, and the capital, and given that you are here
today, also the willingness to participate in our success.

And I have not even begun to talk about our infrastructure needs. Public
sector investment is planned to rise to around eight percent of Gross Domestic
Product (GDP) or R370 million in the coming three years.

South Africa and China have enjoyed rapid increases in visitor numbers to
each other's countries in recent years, both for leisure tourism and business,
and this trend is sure to increase further. All of this depends on the extent
to which we in South Africa address our massive skills challenge.

It is for that reason that we highly appreciate China's contribution in this
regard vis-a-vis the agreement signed between our Minister of Finance and
China's Minister of Finance which will strengthen their cooperation as
follows:

1. An Agreement on Economic and Technical Cooperation to the value of 20
Million Yuan (about R18 Million) as donated by the Government of the People's
Republic of China to the Republic of South Africa supporting Human Resource
Development Projects will be entered into between the Signatories. The
Agreement will provide for the training of 300 people in three years from 2007
to 2009.
2. The Government of the People's Republic of China further agrees in principle
to assist the Government of the Republic of South Africa in the construction of
a primary school in a rural area. The Signatories declare their intention to
hold regular consultations at least once a year, at senior official level, on
issues of mutual concern and interest. The aim of the consultations would be to
review the progress made in the areas of Co-operation identified in the
Agreement on Economic and Scientific Co-Operation. We will also identify new
areas of Co-operation where possible and in general further enhance and
strengthen the friendly relations and co-operation that already exist between
the two countries.

I am also particularly excited that there will also be an opportunity for
our people to learn Chinese. I especially like to thank the Chinese Ambassador
to South Africa His Excellency Mr Guijin Liu for his tireless work on the issue
of the Memorandum of Understanding between Republic of South Africa and the
People's Republic of China on economic co-operation, with the emphasis on
resolving the issue of increasing clothing and textile imports from China.

As sport enthusiasts, we have two major events to look forward to the 2008
Olympic Games in Beijing and the 2010 Soccer World Cup to be held in South
Africa. Already discussions are under way on how we can co-operate in the
hosting of these two sporting spectacles that will turn a positive spotlight on
China and South Africa respectively. So as we enjoy the current World Cup
matches taking place in Germany, in our minds we are already anticipating
welcoming the world in 2010.

And your visit will be followed by China hosting the Ministerial Meeting and
Leadership Summit of the Forum of China Africa Co-operation (FOCAC) in Beijing
towards the end of the year.

I think that this gives a strong indication of China's desire to seriously
engage with Africa and foster strategic relationships not only with South
Africa, but with the African continent as a whole.

We have great appreciation for the importance you attach to your
relationship with Africa and believe that you can be an important partner for
Africa in achieving its development goals as identified in the New Partnership
for Africa's Development (NEPAD).

South Africa has high hopes for the FOCAC Summit in November establishing a
solid work programme that will see China play an active role in some of the
NEPAD projects to be undertaken continent-wide.

Africa has vast infrastructure development potential and needs, and Chinese
capacity in this area is well-established.

To our businesses here today I would like to pose the challenge of also
looking beyond China and South Africa to the region and beyond on the African
continent for Chinese and South African companies to form partnerships that
will harness some of the resources and capacity on the continent to promote
economic growth for all our prosperity.
As friends we are already co-operating in many fields and I believe we will
continue to broaden and deepen this co-operation so that we contribute
positively to growth and achieving development goals in a manner that is
responsible, sustainable, and ensures a mutually beneficial outcome.

I, therefore, urge all of us present here today to take a long-term approach
to this relationship and forge out practical ways in which both countries can
benefit from our friendship.

I thank you, Chie Chie.

Issued by: The Presidency
22 June 2006
Source: SAPA