Speaking notes for Minister of the Department of Trade and Industry M Mpahlwa: South Africa-Guinea Bissau Forum

Your Excellency, Martinho N'Dafa Cabi,
Honourable Ministers,
Ambassador Majola!
Leaders of Industry from both countries
Distinguished guests
Ladies and gentleman,

I firstly wish to use this opportunity to congratulate HE Matinho N'Dafa Cabi upon his appointment as Prime Minister of Guinea Bissau. Prime Minister, may we also use this opportunity to together recognise and celebrate the growth in real Gross Domestic Products (GDP) by 2,1% in 2006 and the very high expectations for growth in the immediate future for your country. These expectations tell us of a nation that is growing in confidence and that has begun on a systematic path of development. As much as these developments are an inspiration! Your country inspires us too.

Zambia's first President Kenneth Kaunda reminded us a few months ago of the excitement and inspiration as African countries began freeing themselves of their colonial rulers. President Kaunda said "it was a fantastic time. Ghana's first president Kwama Nkrumah, invited me to Accra for the festivities. All of Africa was celebrating, and it was truly incredible. People were singing and dancing in the streets. We wanted to reshape the world and we wanted to do everything differently."

Since those heady days, it appeared for a long time that Africa could never pretend to the ambition of re-shaping the world and doing everything differently." It is therefore a great honour for me to be
present here today, where indeed we are doing something differently, the honour of a first visit by the Prime Minister of Guinea Bissau.

Our task therefore it exciting differently than before is to put into action our ambition. And our ambition today is to utilise this opportunity to ensure increased economic co-operation between South Africa and Guinea Bissau. This event must therefore foster and highlight the importance of creating effective linkages between our governments and business communities. It is at this point that must say that it is with the deep lessons of its history in mind that democratic South Africa has committed itself to doing all it can to rebuild our continent.

We believe we all stand to lose if our growth is seen as a threat rather than an opportunity. South Africa's economic policy for Africa is therefore fundamentally developmental in nature and is rooted within our foreign policy in which Africa is the first priority and the framework of New Partnership for Africa's Development (Nepad). The policy is premised on the necessity to promote intra-Africa trade and to deepen regional economic integration. Africa forms the focus of South Africa's global economic, strategy, within which government pursues a strong developmental agenda.

Partnerships with countries on the continent are therefore considered vital and strategic South Africa's economy inextricably linked to that of Africa as whole and her own success is linked to the economic recovery of the continent through Nepad. In this respect, ladies and gentlemen, South Africa and Guinea
Bissau established formal diplomatic relations in October 1994 and it is true to say that we have not yet fully exploited our potential relationship. Let me therefore at this point also acknowledge the role of Ambassador TC Majola, who is also an Ambassador for Senegal, Mauritania and Cape Verde and who has done much to ensure that we act differently.

With our support she will be key driver in deepening our economic co-operation and we wish her well in this task. Prime Minister Cabi, both South Africa and Guinea Bissau face bright economic futures and we will be stronger working together than working alone. In South Africa, government has just released the national industrial policy framework and action plan. The implementation of the plan will result in a step change in industrial development and will open up new frontiers in manufacturing activity. Similarly, I understand that Guinea Bissau seeks to expand the diversity of products and sectors beyond the well performing cashew sector. We have head for instance that the development of both the
Bauxite and Phosphate industries and the existence of unexplored crude oil, can significantly contribute to job creation and economic growth.

To realise the potential of these sectors will involve enhanced investment and industrialisation. The potential for greatly increased economic co-operative between our respective countries is therefore obvious and the challenge before us is to establish the mechanisms to do so.

For that reason, we must accelerate the process negotiating and signing of a Bilateral Trade Agreement, a Reciprocal Protection and Promotion of Investment Agreement and a Memorandum of Understanding (MoU) on Economic Co-operation. Furthermore in regard to this proposed memorandum we must consider developing a comprehensive programme of action that will facilitate and monitor the level of technical co-operation between the two countries.

In particular the conclusion of a Memorandum of Understanding on Economic Co-operation framework would, for instance, enable this government to mobilise the exchange of expertise and technology from a variety of government departments and state agencies to support the commercialisation process of agriculture in Guinea Bissau, amongst other initiatives. This is also the context within which the developmental impact of the work of the State Owned Enterprises (SOEs) in the rest of Africa is subject to codes of conduct regulated by government. The entities are required to integrate commercial viability and returns in investments with appropriate policies and procurement, the empowerment of small, medium and micro enterprises (SMMEs), the employment of local labour and services. Furthermore they are required to specifically intervene to encourage sustainable development towards the upliftment of communities. This ensures that backward and forward linkages are built through technology transfer, employment and skills development.

We want to see more use made local enterprises in the supply chain, thereby, contributing to more sustainable and job-creating investment outcomes. Similarly, the government would like to see all South African investment, including that of the private sector; make a positive contribution to economic development and industrialisation. Indeed, we regular advise the private sector with the sustainability of their business which is directly proportional to the deepening of partnership ties with local entrepreneurs.

This developmental approach is one that emphasises broad based engagement that seeks to strengthen economies. This approach seeks to unleash the potential and build long term partnerships in order that our own growth will pull growth on the continent. Therefore the proposed memorandum would also encourage and establish institutional relations between CHAMS 4, Business Unity South Africa (BUSA) and Guinea Bissau Manufacturing Industries Association and the Bissau Chamber of Commerce.

These steps will be complemented by the fact that we have appointed a Foreign Economic Representative for trade and investment related issues in Senegal, with major responsibilities in relation to Guinea Bissau. This person reports directly to the Department of Trade and Industry and I can assure you Prime Minister that we will make sure that she fulfils those responsibilities.

We also propose to co-operate with our colleagues in Guinea Bissau to foster trilateral and multilateral partnerships for development. We will encourage South African skills and knowledge to avail themselves as preferred technical partners for implementation of various projects in the region. In most areas South African skills and knowledge is sub-contracted, by developed nations, to implement skills in the region. Joint venture partnership with various development agencies and multilateral institutions is vital for the implementation of projects in the region and we will if requested, provide the necessary support and partnerships.

Ladies and gentlemen, together we must also encourage the development of energy and mineral resources in the region. We know that Africa is an increasingly important oil supplier for both developed and developing nations of the world, with 25% of oil export destined for China, 15% destined for United States. Oil export to these countries is estimated to rise even more with China demanding 60% of oil resources by 2020. Energy resources in South Africa are also becoming a challenge and alternative sources of energy is needed to meet the rising demand. West Africa presents an ideal opportunity to meet such demand. With Sasol and PetroSA being the forerunners in gas to liquid technology, huge opportunities exist for joint venture partnerships and capacity building in this area. South Africa also has significant resources in technology and equipment for extraction of minerals and joint venture partnership with Guinea
Bissau could be encouraged to develop these resources.

Ladies and gentlemen, I would like to conclude by pointing out that all these issues I have raised today can be summarised by saying that our ambition is that in collaboration with Guinea Bissau, we seek to encourage the implementation of an African agenda that will enhance the development of trade, cultural and civil society association between stakeholders in South Africa and Guinea Bissau.

I am confident that the various presentations and deliberations on opportunities in Guinea Bissau will yield tangible results in terms of trade and investment between our sister countries. It is my sincere wish that mutually beneficial business linkages, partnerships and joint venture partnerships will emerge from our discussions today. I wish you success in all your endeavours.

I thank you.

Issued by: Department of Trade and Industry
7 August 2007