Posted: March 10, 2022
Programme Director: Ambassador Ntshinga,
Minister Naledi Pandor,
Minister Pravin Gordhan,
Ms Bongiwe Kunene – Managing Director: Banking Association South Africa (BASA),
Mr Cas Coovadia-CEO: Business Unity (BUSA),
Mr Kganki Matabane-CEO: Black Business Council (BBC),
Senior Government Officials,
Members of the Press,
Ladies and Gentlemen,
As the Department of Trade, Industry and Competition (the dtic), we commend DIRCO for taking this pivotal step in creating a platform for strategic economic and commercial engagement with the African continent.
This platform will accord us, as Departments, a consultative platform with business and SOCs in pursuance of the integration of our continent through infrastructure development, industrialisation and market integration.
During his inaugural State of the Nation Address in 2019, President Cyril Ramaphosa spoke about his vision of a better Africa and a better World. I quote:
“An essential part of South Africa’s growth strategy is the integration of our economy with those of our neighbours and the rest of our continent.
The African Continental Free Trade Agreement (AfCFTA) will improve the movements of goods, services, capital and means of production across the continent.
Our revitalized industrial strategy focuses on the expansion of our trade and investment links with the rest of the Southern African region and the continent at large.
Within the Southern Africa Development Community, we will prioritise development of cross-border value chains in key sectors such as energy, mining and mineral beneficiation, manufacturing, infrastructure and agro-processing.” end Quote.
As the department that plays an important role in the overall economic development agenda, including advancing South Africa’s economic interests at a bilateral and multilateral level, our strategic objective is to ensure the policy objectives defined by President Ramaphosa since 2019 are pursued with determination, focus and in a more coordinated manner.
Therefore, the launch of COMED is a welcome development and we wish to applaud all the public and private sector representatives who will lead South Africa’s charge in this very important platform.
Honourable colleagues, Minister Pandor and Minister Gordhan, the dtic has defined a very ambitious plan for 2022/23 and beyond.
One of the key strategic objectives of our plan is to enhance the competiveness of South African firms in order to position them to fully capitalize on the opportunities flowing from the implementation of the AfCFTA.
In this regard, COMED could serve as complementary and useful platform to strengthen collaboration across Government departments, other public entities and our social partners, including private sector and labour.
COMED could also help us to craft a common agenda and develop a joint programme of action vis a vis the rest of Africa, akin to a South Africa Incorporated Approach.
In terms of South Africa’s merchandise exports, Africa was the 3rd largest destination (24%) for South Africa on average over the last 5 years, followed by Asia (29%) and Europe (25%).
It is important to note that the bulk of South Africa’s exports to the rest of the world is mainly dominated by unprocessed raw materials while exports into the continent are mainly value-added manufactured goods.
South African companies are playing an important role in promoting intra-Africa trade.
Notably, South Africa’s share of intra-African exports varied from 26% to 31% over the period 2013-2019, followed by Nigeria (13, 9% in 2019) and DRC (7% in 2019).
SA is also the leading nation in intra-African imports accounting for 14%, followed by Namibia (7%) and Botswana (6%).
South Africa is also a major investor in Africa. Between January 2003 and December 2021 a total of 558 FDI projects were recorded.
These projects represent a total capital investment of R253.71 billion, which is an average investment of R3.13 billion per project.
During the period, a total of 4,227 jobs were created across Africa.
Yet, notwithstanding its positive track record, South African firms are facing many challenges in the form of tariffs, non-tariffs, technical barriers to trade and unfavourable operating environments.
As a result, several South African companies, many of whom played a pioneering role in changing the African economic landscapes, are beginning to pull back or downsize their African operations.
Amongst these are companies such as Checkers/Shoprite, Game, Tiger Brands, Woolworths, Sasol, to mention a few.
These companies were able to pull along a significant portion of their South African supply chain to export more Made in South Africa goods and services into distant markets across the continent.
Therefore, there is an urgent need for Government and the private sector to come together to urgently address the challenges faced by South African companies when doing business in the continent.
It is, therefore, our view that COMED could act as the platform where South Africa’s domestic and African agenda could be tightly knitted together.
Building onto the work of COMED, as the dtic we will look into the possibility of establishing a dedicated Africa Branch to elevate our commercial and economic relationships with the rest of Africa; and to give credence to our commitment to Africa’s development.
We will lobby other strategic components of Government and Business to consider doing the same in order to maximise the impact.
Minister Pandor, with this in mind I would like to give you the assurance of our full support and commitment to ensure that COMED is empowered to achieve and fulfil its mandate.
I thank you.