Remarks delivered by the Deputy President, Ms Phumzile Mlambo-Ngcuka, on the occasion of Czech Republic - South Africa State Visit, Business Forum Meeting - Sheraton Hotel, Tshwane, 12 December 2006

President of the Czech Republic, Mr Vaclav Klaus,
Czech Deputy Minister of Industry and Trade, Mr Martin Tlapa,
The Czech CEO of the Czech Economic Chamber, Mr Jaromir Drabek,
Deputy Minister, Dr. Rob Davies,
President of the Chambers of Commerce and Industry of South Africa (CHAMSA), Mr Patrice Motsepe,
Members of the business delegations,
Distinguished guests,
Ladies and gentlemen,

It is an honour and privilege for me to welcome the President of the Czech Republic, his Cabinet members and the entire business delegation to our warm and sunny shores.

I am truly delighted that you and your delegation have accepted our invitation to pay an official visit to a democratic and free South Africa. I am pleased to convey the warmest greetings of the government and people of South Africa to President Klaus, the government and the wonderful people of the Czech Republic.

This is an historic visit in a sense that both our countries are recognised worldwide as part of the emerging markets, with much to learn from each other. The Czech Republic and South Africa are emerging markets with significant poles of demand in their respective regions. Our relationship, albeit at the genesis stage, has considerable potential for the acquitting and nurturing of both political and economic dimensions.

Transformation in both countries

The Czech Republic like us is in the throes of a transformation process, it was before the transition to a market economy characterised by one of the smallest private sectors producing a negligible fraction with quantity preferred over quality, over-centralisation of the economic structures with heavy industry the focal economic sector.

It has now transformed into a buoyant economy that prides itself on improved industrial productivity focused on high input manufacturing; increased consumer purchasing power; continued strong real growth and sound economic fundamentals.

South Africa's transformation since democratic transition in 1994, like the Czech's, is nothing short of a remarkable miracle. We have managed to implement solid macro-economic reform and transition to a status of an emerging market with one of the lowest risk profiles; a very developed financial sector; central bank with strong credibility; real household consumption expenditure growth and world class corporations. '

The Czech Republic has managed to implement incentives that are at the core of strongly rising inflows of the Foreign Direct Investment (FDI) beginning in 1999, both in acquisitions and greenfields projects. The surge in FDI has contributed to the acceleration in the pace of export diversification.

South Africa on the other hand is at a stage of reviewing its incentive offering in the light of global markets developments to ensure that a more value-laden offering is available to potential investors.

This, coupled with our recently adopted export strategy provides the policy framework that is adequate to reverse trend deterioration in manufacturing performance and an expansion of non-minerals tradables, which will enable us to take advantage of available growth opportunities in the global arena.

Stable and growing trade relations

Trade between South Africa and the Czech Republic accounts for nearly 40% of Czech's total trade with Africa; which shows steady and healthy growth in trade volumes between SA and the Czech Republic over a six year period since 1999.

We believe with the number of trade, economic agreements and Memorandum of Agreements that have been signed today, between our respective governments as well as by the industry our relations will go from strength to strength. The interactions between our respective business communities here today, cemented by the cooperation agreement to be signed at this event between the two Chambers of Commerce and Industry are extremely encouraging and have been long overdue.

Both economies have industries that are globally competitive and sections of our populations that enjoy the fruits of economic growth. For South Africa there remains the challenge of large sections of the population that remains outside of the circle of benefits.

To this accord, we in South Africa are presently engaged in a process to more equitably spread the benefits of growth to a broader segment of the economy. We continue to institute innovative and expansive social transfer programmes to address long-standing disparities within the context of cautious fiscal and monetary policies which have kept inflation and public debt at low levels.

New Initiatives from South Africa include AsgiSA

The Accelerated and Shared Growth Initiative for South Africa (AsgiSA) and the Expanded Public Works Programme (EPWP) for infrastructure presents a significant opportunity for Czech Republic companies and service providers to partner with South Africans in areas such as civil engineering and consulting, manufacturing in a range of sectors, and research and development. South Africa's main 'network industries' - transport, communications, water and energy supply - confront a series of complex strategic challenges with long term consequences for growth and development.

As entrepreneurs there is much to learn from each other as both our economies continue to grow in global trading environment that shows little sign of delivering on the promise of development.

The challenge posed to you today as business executives is to foster partnerships with each other and with government to eradicate poverty, increase employment and more equitably spread the gains of economic growth. Together we can create the environment for enhanced job creation, transfer of technology and skills development. We must be able to leverage the full potential of our human capital.

Please rise and join me in a toast to the good health and prosperity of President Vaclav Klaus, and to the continued excellent relations and good friendship between the wonderful peoples of the Czech Republic and the Republic of South Africa.

To good friendship!

I thank you.

Issued by: The Presidency
12 December 2006

Source: The Presidency (

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