Address by Deputy President Cyril Ramaphosa at the breakfast meeting with Keidanren, The Federation of Economic Organisations of Japan, Taj Hotel, Cape Town
Ambassador of Japan, His Excellency Mr Hiroki
Ministers and Deputy Ministers,
Governor of the South African Reserve Bank, Mr Lesetja Kganyago,
The Japanese Delegation Leaders, Mr Noji, Chairman of Komatsu and Mr Kase, Chairman of Sojitsu,
Business Leaders from Japan and South Africa,
Distinguished Guests,
Ladies and gentlemen,
I am delighted and honoured to address you this morning.
As we welcome Japan’s distinguished business community to our country, we extend our gratitude to Keidanren for accepting our invitation to visit South Africa.
My delegation and I remain immensely grateful for the hospitality, generosity and friendship shown by Japan’s political and business leaders during our working visit to the country last year.
We learned a great deal during this visit and returned home convinced that if we are to realise our potential as a nation, we need to ensure that Japan and its people are an integral part of our developmental agenda.
Keidanren, as one of the most representative business federations in Japan, is a critical partner in advancing trade and investment relations between South Africa and Japan.
Japan remains South Africa’s third largest trading partner.
There are around 130 Japanese companies in South Africa, employing over 150,000 people.
Your presence here today demonstrates that there is great interest from Japan to expand this cooperation further.
It demonstrates what we firmly know and believe – that South Africa is a country of great opportunity.
It is, as we say, alive with possibility.
South Africa is an attractive destination for investors seeking sustained returns.
The country has a diversified economic base with developed industries in areas like resources, manufacturing, retail and services.
It has advanced financial and communications infrastructure and extensive road, rail and port facilities.
Most importantly, South Africa has a young workforce.
Over the last two decades, access to education has expanded rapidly with a significant increase in enrolments in higher education.
This means that, in the coming years, as the workforce in the developed world ages, South Africa’s educated youth will be uniquely poised to power a new wave of production and growth.
It is this combination – of youth and skills – that will make Africa the centre of global economic growth in the 21st century.
We are determined that the relations we are building with Japanese business should bring opportunity not just to our country, but to our continent as a whole.
We are therefore strong supporters of initiatives arising from the Tokyo International Conference of African Development, or TICAD.
We are certain that our continent will derive immense returns from our partnership with Keidanren as we jointly explore business opportunities both here and elsewhere on the continent.
Many international companies choose to locate their African operations in South Africa because we have strong public institutions, an independent judiciary and a transparent regulatory environment.
We have a solid record of prudent fiscal management and sound macroeconomic policies.
Our democracy is vibrant and resilient.
Even as we promote the country as an investment destination, South Africa recognises that it has a number of challenges.
We are building from a low skills base.
Two decades into democracy, we continue to feel the effects of an apartheid education system that denied our people the skills needed to advance and prosper in a modern economy.
As a result, we are still faced with high unemployment and widespread poverty.
Apart from the devastating human cost, such deprivation also limits the potential of our economy to grow and meet the needs of our people.
Like much of the continent, South Africa is overly reliant on commodity exports.
Due to our skill constraints, due to a historically-narrow manufacturing base, South Africa does not derive sufficient value from the minerals it mines and the food it grows.
It is to answer this challenge that we have embarked on a process of intensive industrialisation – a process in which we want to involve our partners in the Japanese business community.
We acknowledge also that we could do more to improve the ease of doing business in South Africa.
We have made significant progress.
It now takes just a few days – and sometimes a few hours – to register a new business.
But there are many other bureaucratic processes that we are working to simplify and accelerate.
In his State of the Nation Address last week, President Jacob Zuma emphasised the important of improving the conditions for investment in the economy.
Our government is thus working speedily to create the correct investment support infrastructure.
We are fast-tracking the implementation of the Invest SA initiative, which is a one-stop investment shop to assist investors in meeting all the necessary legislative and regulatory requirements.
It will reduce the cost and complexity of investing in South Africa.
It will ensure government departments and agencies are more efficient and more responsive.
This is one of the ways in which South Africans are working together to grow the economy and create jobs.
We are guided by our National Development Plan, which provides an overarching framework for our economic and social programme towards 2030.
Within the plan, there are specific areas that we have prioritised to address the most pressing economic challenges.
We have identified those economic sectors that have the greatest potential to drive growth and create jobs.
As part of our industrialisation programme, we are providing incentives and other forms of support to these sectors.
In the past few years, we have achieved impressive results from our incentive programme aimed at the automotive and textiles.
We are using the lessons from these programmes to design support packages for other key industries.
Another element of our economic programme is the largest investment in economic and social infrastructure ever undertaken in this country.
We are building roads, rail lines, ports, dams, pipelines, power stations, hospitals, universities, schools and clinics.
This programme is being centrally planned and coordinated, ensuring that our expenditure on infrastructure is used more efficiently and has a greater impact on jobs, localisation and the development of our industrial capacity.
This investment not only stimulates economic activity. It also provides the physical infrastructure that will enable us to grow our economy and meet our social needs.
Our growth plan also includes an injection of new entrepreneurial support for previously disadvantaged groups.
We are supporting the emergence of a new generation of black industrialists.
We are using this programme for skills development and improving standards, quality and productivity.
We are also providing access to finance and assisting with entry into new markets.
In this area, as in many others, South Africa and Japan have much to gain from cooperation and collaboration.
Japan could assist emerging black industrialists in accessing markets, skills and technologies.
We look to Japan to assist our country in the development of a thriving hydrogen economy.
We look to Japan to invest in our ocean economy and aquaculture and provide training in boat building and ports management.
We look to Japanese companies to work with our businesses and people to invest in water and sanitation projects, agriculture and agro-processing.
Japan’s companies are well poised to work with us in the beneficiation of our mineral wealth.
Ladies and gentlemen,
Japan is an important ally in our effort to build the economy and create a better life for all South Africans.
In the last year alone, our economy benefited from significant investments from Japanese companies.
Toyota opened a new production line for Quantum minibuses.
Mitsubishi Hitachi Power Systems contributed to new electrical capacity by bringing Medupi Unit 6 online.
We are excited by the launch of two new local corporations, Mitsubishi Hitachi Power Systems and Sumitomo Corporation, and the establishment of 12 new representative offices in South Africa of Japanese companies.
Beyond the foreign direct investment we are also encouraged by the development of the skills of locals who work for Japanese businesses.
This is a major area of cooperation. Japan’s advanced technological and industrial expertise will contribute to further industrialisation, job creation and economic development.
Through the African Business Education Initiative, Japan is currently supporting 49 South African students undertaking master degrees in several technical fields, which will be followed by internships at Japanese companies.
Furthermore, we were particularly moved by the speed with which the Japanese government answered our request last year for a specialised artisan training programme for young South Africans.
Ladies and gentlemen,
We have no illusions about the economic challenges that are being faced by countries around the world.
In the wake of the commodity slump and the slowdown in several important economies, South Africa faces a period of slower growth and fiscal constraints.
Yet, our confidence in the longer-term performance of our economy remains undiminished.
We are an attractive investment destination.
We are pursuing measures to fundamentally transform our economy, ensuring that it is more productive, more inclusive and more sustainable.
We are directing all our resources and energies towards the development of the skills of our youth and the creation of jobs for them.
We are convinced that the prospects for cooperation between South African and Japanese business have never been better.
We look forward to further deepening our relationship for the mutual benefit of our peoples.
We look forward to a future of partnership, progress and prosperity.
I thank you.
