Speech by the Minister of Foreign Affairs, Dr Nkosazana Dlamini Zuma at the African National Congrges (ANC) REC and Women’s League Fund-Raising Dinner, Parys – 02 November 2007
Theme: How to identify and conquer international markets.
Programme Director, Mr Steve Tshabalala
Chairperson of the ANC in the Free State (FS), Tate Ace Magashule Provincial Chairperson of the Women’s League, Me Sisi Ntombela Regional Chairperson of the Women’s League, Me Mantebu Mokhosi
Stalwart of Women’s League, Comrade Maureen Madumisa
Members of the Executive Committee - Free State Government
Honourable Executive Mayors and Mayors
Provincial and Regional Leadership of the ANC & Women’s League Business, Religious and Sports Leaders
Members of the Public
Members of the Media
Ladies and Gentlemen
All protocol observed:
It is good to be here and I would like to begin by thanking the organizers for this kind invitation to participate in this fundraising event for a very worthy cause – and that is for the ANC in the Free State and the Women’s League and thus for the improvement of the lives of the men and women of this town and this province.
Tate Molapo gave us something to cling on. This was a good guide indeed. The music that we have had tonight is out of this world. It is inspiring indeed. This gathering comes at a time in our history when we are busy consolidating the democracy, when we are seized as a nation and as a country in laying the foundations for sustainable social and economic development. This is no easy task, since only enduring ideas and reinforced foundations can withstand the ravages of time. At the same time armed with the experience of struggle, our efforts are also geared towards building a new reality which is also our unique contribution to the world.
Let us remember that when the women of our country in their historic march 50 years ago proclaimed that: “You have struck a woman. You have struck a rock” they were also reminding us of the decades of struggles that had fortified them and had brought them to that moment in history – a particular time and place in which we find the seeds of our own liberation.
Let us also recall that when the disabled of our country declared that there shall be: “Nothing about us, without us,” they were reminding us of the primary role of people in changing their own lives. They were saying that our mandate comes from the people, from ordinary men and women who have put their faith, hopes and commitment into the ANC.
As we meet here today, we need to recognise that part of our primary task must also be to strengthen our own organisations – for where would we be today without good organisations like the ANC. For we are a Movement of our people whose aim is to meet the needs of the present and to be dynamic enough to meet the needs of the future.
Our task is thus also to deepen the culture of human rights in our country and to entrench democracy as well as within and without our own ranks, because it is on the basis of robust debate and interrogation of the best way forward that we can truly realise our full potential. Only in this way can we proceed with all the good ideas and sound principles that will endure and the necessary confidence that will take this organisation way beyond its centenary anniversary (only six years from now) and guide us well into the future.
Ninety years ago, our President Oliver Tambo, was born into a world that was very different from the one we are living in now. This year we celebrate the achievements of his life and the role he played in forging unity, in building the ANC, in establishing the link with our brothers and sisters in our neighbouring countries, our continent and across oceans. This unity helped us to achieve our freedom and the links we forged with others under the leadership of Comrade OR became an unstoppable wave of collective energies that contributed to our national liberation and laid the basis for our international relations and solidarity in the context of a free South Africa.
Today, I am reminded of his vision and his words. In 1985 at a press conference in Lusaka, Comrade OR quoted a message from our leaders imprisoned on Robben Island and in Pollsmoor Prison, a letter signed by Nelson Mandela. It is from this letter that I wish to quote.
“Unity is the rock on which the ANC was founded; it is the principle which has guided us down the years as we feel our way forward.
In the course of its history, the ANC has survived countless storms and risen to eminence partly because of the stirling qualities of its membership, and partly because each member has regarded him or herself as the principal guardian of that unity.”
It was his understanding and that of a long line of ANC leaders and cadres that as each individual served to protect and enhance the work of the collective, that indeed through our own efforts , each one - and all of us together - are our own liberators.
Indeed today this still holds true - that we are our own liberators. Today this unity must find expression in the way in which we approach our social, political, cultural and economic development.
And truly speaking, this unity is long-lived because it goes hand in hand with democratic practices that I have been talking about.
Today we need to remain true to the vision of Inkosi Luthuli and Comrade OR. We need to build our organisations and be conscious that what we are setting out to do as a country and as a people does offer us the opportunity to contribute something new to the world as well
We need to respond to our detractors with words that have also inspired our struggle for liberation; and that is: A People united shall never be defeated. The conditions of freedom offer us the possibilities to unite as never before – to stand together in this most important and innovative phase of our struggle – and that is the battle for sustained social and economic development.
But the developmental agenda also requires a similar dedication and a greater intensification of our work. Speaking in 1991 at the University of Fort Hare, Comrade OR acknowledged the gigantic effort that would be required of all of us.
He said the following; and I quote:
Transformation requires a more dynamic discourse that insists on capacity and potential; on originality and on a creative existence that makes and remakes its own essence; that stimulates a will to overcome history, time and necessity, rather than encouraging submission. We need to introduce this into our universities as much as to our national fora. South Africa needs to believe in our capacity to overcome our painful history, to begin again and to regard our failures, when they occur, not as finite moments, but as occasions for a new beginning.”
Indeed armed with what OR has called an “originality” and a “creative essence” we shall move forward and make new beginnings out of the experiences that we have garnered over many years.
Thirteen years into our democracy, our country may well be a mere teenager, but our Movement, the ANC is 95 years old. This represents a wealth of history and so many years of experience, so many lifetimes devoted to the cause of freedom.
Therefore, as we meet here tonight, I think that this gathering should also pay tribute to the stalwarts of this Province who for nearly a century have fought for our freedom. This province was the birthplace of Sol Plaatje, a founding member of the ANC and its first secretary general. The ANC had its founding conference in Bloemfontein. This has also been the home of Dr James Moroka, a former ANC President as well as the many other important freedom fighters.
Let us also pay tribute to the late Thabo Mofutsanyana and to Braam Fischer. Let us further recognise and pay tribute to those stalwarts who only recently left us and yet played their part in our struggle for freedom.
Let us also recognise that it was the women of this province who for nearly a century fought against oppression. The struggle for the freedom of women in our country in different waves was spearheaded by women from this province who resisted the imposition of segregation and apartheid.
As early as 1913 the women in the Free State fought against the introduction of passes - in Bloemfontein, in Jaggersfontein, in Winburg. They were treated brutally and imprisoned in Kroonstad. Sol Plaatje captured their bravery when he wrote the following:
“Tears rolled down our cheeks as we saw the cracks on their bare feet, the swellings and chilblains which made them look like sheep suffering from foot and mouth disease… To our surprise however, they vowed never to buy passes, even if they had to come back.”
It is important as we recognise this history that we do not - through our present-day efforts - betray the struggles of those who have preceded us, of those courageous men and women whose deeds have been written in history to inspire us to greater heights.
In 1919 under the leadership of Charlotte Maxeke, the Bantu Women’s League played a pivotal role in defence of women and laid the foundation for the formation of the ANC Women’s League. Women in the Free State also played a leading role in the formation of women’s league.
Later the anti-pass protests of women began in the Free State in Odendaalsrus in 1952 and then spread to other places and to the rest of the country.
Today, looking back, we may well say that these were small steps towards the bigger struggle for women’s emancipation and for the attainment of a non-racial and non-sexist South Africa – but I think that without these earlier struggles, we would not be where we are today.
We in turn need to give greater recognition to how the past has shaped the present – so that future generations will understand what we have done to change and make their lives better and be better able to protect their legacy and to build on this.
I am reminded of the words of the great woman activist and liberation stalwart, Dora Tamana, who said:
“You who have no work, speak.
You who have no homes, speak…
Let us share our problems so that we can solve them together.
We must free ourselves…
Women must unite to fight for these rights.
We opened the road for you, you must go forward.”
I think that it is in this spirit that we meet here today, for the theme of this event, which is “How to identify and conquer international markets” is another way of “opening the road” for the future. It is another pathway for our country going forward and unleashing all the potential we have to be globally competitive and to play our rightful role in the world economy.
I am told that the mission of t his municipality – the Fezile Dabi District Municipality is to “strive to better the quality of life of the people who were previously disadvantaged in its area of jurisdiction” by effectively uplifting Communities, resourcing and rendering of services.
This is indeed another way of opening the road to the future by strengthening on what we have in the present. In the words of Comrade Fezile Dabi, an ANC leader, author, poet, philosopher, mentor, husband and father who passionately fought for freedom during the struggle against apartheid. I think we should remember his words, I quote:
“There is nothing in all the world greater than freedom;
It is worth paying for; it is worth losing a job for;
It is worth going to jail for;
I would rather be a free pauper than a rich slave;
I would rather die in abject poverty with my convictions that live in inordinate riches with the lack of self respect.”
Indeed in an increasingly globalised world where the gap between rich and poor is widening, our success in improving the lives of our people will also be judged on how successfully we can perform in the world economy, how we can foster trade and investment relations, so that our people are indeed the beneficiaries of these developments. This is not an easy task, but I think we are better placed now than ever before to identify our market niches, to examine what we have – the human resources – our people – as well as our natural resources and goods and services that we can market to the rest of the world.
There are also very positive developments. Since 1990, the world economy has become substantially more open and integrated. Despite countless challenges, international trade nonetheless is expanding at rapid pace, helping to power sustained rapid economic growth in many emerging market and developing countries. But this has still to translate into widescale poverty reduction.
Certainly we need to tread with caution but also with great confidence in our own abilities. In order to enter and succeed in a particular market, we need to identify South Africa's strength as well as the identified market's needs. Among other things, we will also need to look at our strengths in particular places and devise export promotion strategies accordingly.
The state of the economy
I think we can say with confidence that South Africa is a growing economy with real GDP growing at an average of 4 to 4,5% per annum, with the growth rate expected to increase to 2009.
The business cycle upswing is currently in its 7 th year, indicating the longest sustained period of economic growth since the 1940s. The South African economy has also increased in sophistication and diversification, with the natural restructuring of manufacturing and services, and the replacement of commodities with more advanced processes.
South Africa has also experienced accelerated inflow of foreign capital with investment in 2005, being the most ever recorded.
We have seen that there has been an increase in job creation in the last 3 years with the unemployment rate also decreasing by 6%, through the net creation of 1 million jobs, largely supported by the growth in the construction and financial services. But of course we need to acknowledge that this is not enough.
Of course the main drivers of economic growth are the mineral products boom combined with domestic consumption growth. The fastest growing economic sectors include construction, finance, and transport. Exports have grown by 19,3% in 2006, and by 15,8% in 2005, with total exports in 2006 amounting to R359 billion.
Undoubtedly the key challenge for the South African economy currently is to increase its economic growth rate; to be aligned with the global trend of moving the industrial base towards higher-value added production; whilst at the same time addressing job-creation. Export development and promotion could play an instrumental role towards increasing economic growth in South Africa over the short to medium term.
The National Industrial Policy Framework (NIPF) is also aimed at playing a key role in making the South African economy more diversified and innovative in order to become more competitive in the global markets.
The NIPF has identified five broad sectoral groupings where sectoral diversification potential lies. These include national-resource based sectors, medium technology sectors, advanced manufacturing sectors, labour intensive sectors and tradable services sectors as well as interventions in the following sectors, namely capital/transport equipment and metals, automotives and components, chemicals, plastics fabrication and pharmaceuticals as well as forestry, pulp, paper, and furniture
The Action Plan will also focus on maintaining implementation of strategies in tourism, biofuels, diamonds, jewellery, agro-processing, film, and crafts.
With the NIPF identifying the key sectors for prioritization and the Action Plan being used as an instrument of implementation, it is clear that the identified sectors will undoubtedly increase exports and achieve some measure of the economic growth objectives as set out in ASGI-SA.
South Africa ’s Export Strategy (ES)
The Export Strategy (ES) is a policy measure for developing and promoting exports under the NIPF. The focus of the ES is exporter development with the target customer group being SMMEs and BBBEE enterprises, including those of the previously disadvantaged. The programme will largely be delivered by the Small Enterprise Development Agency (SEDA), along with the Department of Trade and Industry.
This week we witnessed the inaugural South African Trade and Investment Conference in Durban which attracted more than 500 investors from Africa, Europe, the United States of America, the Middle East and Asia. These investors were eager to identify opportunities in growth sectors such as tourism, infrastructure development and financial services. I think this is another good sign that there will be increased interaction in the near future.
It is in this context that we also need to locate provincial developments and interventions. I have been made aware that the Free State provincial government has identified competitive advantages that it has in the manufacturing sectors. These sectors include:-
- Farms machinery and equipment
- Leather tanning and finishing
- Petro-chemicals and
- Gold Jewellery
I believe that women can also play an important role in these sectors and as we open up economic opportunities, it is also important that we open these to women. Experience has shown that, in too many countries, women have little hope of advancing economically because they lack the basic right to own, and therefore sell, property which is why we must continue to promote property and inheritance rights for women in every forum.
I am glad that the Province is taking a far more robust approach to bringing women into these economic growth initiatives.
As women’s organisations we also need to leverage this positive economic environment and outlook to the benefit of women.
The ASGISA initiative also has a concerted focus on expanding the possibilities for women in the economy and the focus will be on expanding and accelerating access to economic opportunities including skills development and finance.
International Market Entry Strategy
When creating or determining a market entry strategy for your business it is important follow five essential steps.
- The first step involves determining what product to export. The factors consider are the product itself, the quality of the product, the packaging, and what profit you want to achieve.
- The second step involves deciding where to export. Once you have determined the country to which you want to export, it is important to look at the legal requirement of exports in terms of packing, hygiene and environmental standards.
- The third step should be determining the period of preparation and within which you want to have achieved market entry.
- The fourth step is to determine who in your business will do what, what partners will be needed and what assistance you will require.
- Finally, the fifth step will be determining which action will have to be taken.
As you do this, it is important to remember that promoting one’s product in an overseas market can be a difficult task, and an even more challenging task for new or small exporters. I am not saying this to discourage you but to make you aware of what is out there.
Micro Enterprises and co-operatives
In South Africa we recognise that “small, medium and micro-enterprises represent an important vehicle to address the challenges of job creation, economic growth and equity in our country.”
Early last month, I addressed the NAFCOC Annual Conference which was organised around the theme of “Unleashing the Power of Enterprises through Cooperatives and Entrepreneurship”. The Conference saw the importance of the role vibrant SMMEs and co-operatives can play in the economy and that SMMEs have the power to improve the lives of people – through creating jobs, generating wealth, providing needed goods and services and acquiring new skills and technologies.
Our country also has a dual agricultural economy – comprising a well-developed commercial sector and predominantly subsistence-oriented sector. This presents its own challenges that we still have to deal with adequately. Many farmers are also women and the key to economic development in these areas are the women who feed families and entire communities with their produce. Since our country is largely self-reliant and there is food security, we are also in a position to export agricultural produce especially to the Southern African region.
SADC and the African economy
My view is that, since the 1990s in the second wave of democracy to sweep the African continent, we have seen unprecedented growth of African economies. There has been greater diversification and an increase in GDP growth of 6.8%. We have seen an increase in Foreign Direct Investment due to a greater demand of oil, gas and minerals (25% increase) There has been infrastructure and telecommunication development as well as a significant increase in inter-state business investment and social development. The NEPAD initiative is an important cornerstone that lays the basis for sustainable development and establishes conditions conducive for further economic growth and for improving the lives of our people.
Within the SADC region the service sector is blooming and as a result of greater sharing of resources and markets, there are also opportunities in fishing, food industry technologies and agriculture.Given the opening up of economic opportunities, these also represent opportunities for women. I hope that we appreciate that women are not only half our population in this country but they produce the other half
In fact, a study by the World Economic Forum “The Africa Competitiveness Report - 2007” says that “women comprise one of Africa’s hidden growth reserves, providing most of the region’s labo(u)r, but their productivity is hampered by widespread inequality in education as well as unequal access to land and productive inputs”.
More needs to be done for women to play their part in African economic development. There is widespread recognition that in order to achieve the developmental objectives of the continent to the fullest we need to to encourage and enhance the culture of entrepreneurship amongst our people.
South Africa ’s Export Strategy
In our country an important initiative is the Exporter Development Programme which is designed to:
- facilitate training programmes for potential exporters;
- carry out assessments to ensure the readiness of products for the export market;
- improve the quality of products;
- assist with enhancing the productivity of a small business enterprise; and
- ensure that the product does meet international process and accreditation standards.
It is for this reason that government has taken the step to make this information much more accessible to our people through the establishment of Small and Enterprise Development Agency (SEDA) in all provinces to advice and support the growth of co-operatives and small businesses in our country.
Some of the industry sectors that SEDA has identified as key in the sustainable development of small business enterprises include arts and crafts, agro-processing, jewellery, leather, wood products, plastics, recycling, tourism, food wear, building and construction, paper and emerging farmers.
International Market Entry Strategy
South Africa has developed an Export strategy for the task of promoting one’s product in an overseas market can be a difficult task, and an even more challenging task for new or small exporters.
The Department of Trade and Industry is available for assistance in any area. Furthermore, the Export Marketing Incentive Assistance (EMIA) Scheme is a tool which can aid you in promoting sales through exhibitions, sales visits, catalogues, brochures, and samples.
Entering a market should be a matter of deciding which market entry strategy will suit your business and product the best. There are varieties to choose from such as direct export, indirect export, collective export, and many many more.
Therefore, when it comes to conquering an international market the key to success is always research through which you acquire relevant and essential. Conquering the local market will not always mean success in an international market, so one’s best weapon is knowledge and ammunition will be assistance and research.
There could be many opportunities for competitive products or services to be exported. We must remember that not all products are suitable for all markets. In some markets the demand for some products are very high while in other markets there might be no demand for those products.
Demand can also be influenced by the level of production of a specific product in the foreign country or by its immediate neighbours. Therefore, for me, a good starting point to enter the international market could be our own neighbouring countries. This means that we will be close to the customers and our cultures are similar. Our neighbouring countries provide us with a huge market.
South Africa is now the biggest investor in Africa and SADC represents a total population of approximately 200 million people. Work within SADC is geared towards regional integration and the strengthening of the SADC secretariat to to address developmental challenges.
There have been processes embarked upon to identify concrete projects in the region. There is also unprecedented interest from other regions in the world – the SADC secretariat has been presented with proposals – in the pipeline is also a proposal by the Gulf Co-operation Council to conclude an MOU on Co-operation.
West and Central Africa with their large markets provide enormous economic opportunities for South African SMMEs. There are in small-scale mining, construction, oil and gas services and agriculture among others. In West Africa, in particular, they have fruits but not agro-processing which they need to preserve produce and store for later use and export. Opportunities also exist in agriculture and agro-processing, textiles, hospitality and tourism offer possibilities as well as handicraft and interior decoration. Within North Africa, there are niche market opportunities in ICT, paper and pulp in Tunisia as well as public works programmes in Libya and Algeria.
Economic Opportunities beyond Africa
There are also many opportunities in countries beyond Africa. For example, we have a free trade agreement with the European Union which means that our products can enter the market duty free or enjoying preferential duties. Let us bear in mind that the EU consists of 27 countries and we need to take advantages of the opportunities that exist – since this is market that is open to us. We also need to consolidate our relations with the former Soviet states – these are largely untapped markets and their governments are eager to forge relations with the South in general and South Africa in particular.
I would like to remind this gathering of the “one village, one product” project. The project aims to support developing nations in Asia, Africa, Oceania, Central America, etc. under the leadership of the Japanese Government, as part of the “Development Initiative” announced by Mr. Koizumi, the then Prime Minister of Japan, in December 2005. I this that our up am coming entrepreneurs should take advantage of initiatives such as this.
Let us also remember that many of our products can also be exported to the USA duty free under the African Growth and Opportunity Act (AGOA).
Through our South-South co-operation agreements, we can also market our unique products without any hiccups.
We should note that South African exports to Asia and the Middle East increased by 46% from R64.25 billion to R93.54 billion (if we compare figures for January to August 2006 and January to August 2007)
The large and rapidly growing markets in Asia such as China and India are ready to receive our products if they are competitive as shown by the new trade agreements through IBSA, NAM and NAASP.
The Forum on China – Africa Cooperation (FOCAC) has identified certain sectors as key to the social and economic development of our continent and China.
In China, there are economic opportunities for the export of citrus fruit, table grapes, tobacco leaf, pork and poultry as well as material of animal origin, excluding bones, horns, hooves, claws, coral and shell. In agriculture there exists opportunities in animal husbandry, agro-processing, agricultural machinery, food safety and epidemic control, sanitary and phytosanitary measures, fishery and farming. The possibilities are out there and endless. Solar technology, agricultural biotechnology, the development and mining of new medicine and information infrastructure development are some of the areas that have been identified to improve our capacity in the field of Information and Communication Technology
China has pledged to increase the number of import items qualifying for zero-tariffs from the African Continent from 140 to 440 products at the conclusion of FOCAC last year.
During the second Conference of Chinese and African Entrepreneurs which was led on the fringes of FOCAC in Beijing last year there were about 14 agreements worth 1.9 billion US dollars between 11 Chinese enterprises and African governments and private enterprises.
The Shanghai Expo in which we shall be participating also provides us with another opportunity to strengthen our relationship with China. 46 African countries will be participating at this event in China next year to showcase the economic and cultural opportunities available on the African continent.
The Expo is a platform to learn and exchange ideas on innovation, culture, economic and scientific and technological achievement.
South Africa has strengthened its relations with Japan and we have seen an opening of business opportunities with Japan. Japan has been assisting developing countries through its One Village, One Product Project and South Africa has been invited to attend a training course of this project in the 1st quarter of 2008.
In November this year, we shall also have an opportunity to further strengthen our relations with Korea in the context of the Korea-Africa Forum.
We have also this year strengthened our ties with Vietnam and our export to Vietnam include base metals, wood and articles of wood, as well as machinery and mechanical appliances, prepared foodstuffs, products of chemical and allied industries, animals and animal products.
India is fast becoming a valuable partner for South African enterprises.
Export opportunities for our country include mining technology, specialised equipment in security and the medical sector, fresh produce, beverages, processed food as well as prepayment metering and revenue management technology and automotive parts.
The IBSA initiative creates opportunities for better movement of goods and people between three great continents and thus ensure increased business prospects that our entrepreneurs can benefit from. This includes the area of agriculture, especially with regard to research, trade and the role of agriculture in rural development.
The New Asia-Africa Strategic Partnership is also meant for business to forge links hence you must take advantage of these economic opportunities. However, it is important to determine which foreign market would be the most suitable for our specific products. We must target the best one first and establish a foothold there. Then, move on to the others.
T here are also bilateral benefits that South Africa can accrue from the African Diaspora relationship. These include strengthened historical and cultural ties; expanded trade opportunities; increased tourism; skills exchanges and increased multilateral co-operation. The Diaspora represents a significant market opportunity for African e-commerce entrepreneurs.
Over the years we have also expanded our missions in Latin America, giving us an opportunity to facilitate investment opportunities for South African business. We have not yet fully exploited trading opportunities between South Africa and MERCOSUR ( Argentina, Brazil, Paraguay and Uruguay with Bolivia, Chile, Peru, Mexico and Venezuela being associate members of this trading block) – we need to increase trade conducted between the two regions.
While there are several South African companies that have invested heavily in this market especially in the mining, banking and the services industries, we need to further tap the economic potential of this region and diversity our exporting potential to this region.
Whether we choose Africa, Europe, America, Asia or any other market, we must obtain as much as possible information about the country, the market and the possible customers. The Departments of Foreign Affairs (through its diplomatic missions) and Trade and Industry in the target markets are ready to assist you to obtain information you need.
Participation at international exhibitions and visits to the international markets are essential marketing tools that need to be used. Our DTI runs a number of incentive schemes that can assist you towards the costs of exhibitions and travel to foreign markets. Our diplomatic missions can also assist companies with arrangements for exhibitions and to identify possible foreign clients.
I hope that the private sector present will use this opportunity to forge relations with the organisations of our people present, particularly women’s organisations and particularly with women’s economic initiatives.
Forging closer working relations with women organisations will also go a long way in further advancing and safeguarding the interests of women. I think that together in partnerships between our government and our people as well as with the private sector, we can indeed accelerate the political, social and economic development of our people.
I am reminded of the words of Inkosi Albert Luthuli, our Nobel Laureate and then President of the ANC in a speech he gave 50 years ago:
I think there is a challenge to us in South Africa to set a new example for the world, Let us not sidestep that task. What is important is that we build a homogeneous South Africa on the basis not of colour but of human values…. I believe we all will do our best – whatever the difficulties are – for the realisation of this democratic South Africa we dream of.”
We can do so with the creativity and originality that Comrade OR spoke about and in showing the world a new way to human progress – a more people centred, productive and inclusive world.
I thank you.