Address by H.E. Phumzile Mlambo-Ngcuka, Deputy President of
the Republic of South Africa at a South Africa-Italy Business Forum, Johannesburg,
South Africa, 09 July 2007
Deputy Prime Minister and Minister of Foreign
Affairs, Mr Massimo D'ALEMA,
Ambassador of Italy to the Republic of South
South Africa's Ambassador to Italy
Members of the delegation
Distinguished members of the South African business community,
It is a great honour and pleasure
for me, on behalf of the people of my country, to welcome Deputy Prime Minister
D'ALEMA and his delegation to the beautiful Republic of South Africa.
understand that from here the Deputy Prime Minister and his delegation will visit,
among others, the provinces of KwaZulu-Natal and the Western Cape. I can assure
you, that you will go back home with rich and unforgettable memories and experience
that attest to the beauty of African eco-tourism and the hospitality of South
I would like to underscore the importance of this forum as not
only serving the purpose of improving trade relations but also promoting people
to people interactions amongst our peoples.
Africa and Italy are best friends. Ours are tried and tested relations that hold
great opportunities for the future of both our countries. Indeed, bilateral engagements
between us have and will continue to intensify.
It is on this basis that,
in the year 2003, we mutually acknowledged the need to deepen our relations even
further by signing a Memorandum of Understanding (MOU).
The signing of
the MOU served to cement a diplomatic relationship that had already been blossoming.
President Mbeki had in 2001 visited Italy, on the occasion of the World Food Summit.
The following year, President Carlo Azeglio Ciampi also paid a state visit to
our country. These visits form the solid foundation through which BUSA (Business
Unity South Africa) and Confindustria can consolidate their relationship.
the MOU has served a strategic purpose in structuring and taking our bilateral
relations to higher levels. Since 2003, the number of diplomatic and business
engagements have increased by leaps and bounds. In May the same year, South Africans
were honoured and pleased to receive a business delegation from Italy led by the
Governor of the Lombadry Region, Mr Roberto Formigoni.
It is, among others,
on the basis of the foundation laid by this visit that our business association,
Business Unity South Africa (BUSA), signed an MOU with Confindustria, an important
business player in Italy I was made to understand.
In the context of the MOU
President Mbeki paid a visit to Italy in May 2005 and met with a number of Italian
political and business leaders, including President Ciampi as well as former Prime
Indeed, the MOU has made it possible for both our
governments to meet and consult with each other on regular basis regarding issues
of mutual interest. It is within this context that our Foreign Minister, Dr Nkosazana
Dlamini-Zuma, met with her Italian counterpart, Minister Gianfranco Fini last
year in November.
These are only highlights of a diplomatic relationship
that could aptly be described as one that defies the constraints imposed by distance
and geographic space. Our meeting here today further attests to that reality.
In the area of trade, Deputy Prime Minister D'ALEMA will be
pleased to know that Italy ranks amongst our country's top ten trading partners.
We will, therefore, understand why we value Italy so much.
For the past
few years, trade between our two countries has been growing steadily, reaching
R23 billion last year. Italian companies are among those that have taken advantage
of the sound economic management of the democratically elected government and
the thriving business environment we have created over the past 13 years.
Africa also wishes to strengthen its role in the region, primarily through Nepad
and the AU (African Union), and in this regard deepened trade relations with influential
players like Italy are paramount.
Italy also has a firm understanding of
the needs of the developing world, and therefore has been able to advocate for
these through its position in the G8.
South African business stands to learn
many lessons from Italy, especially in the context of Italy's very robust SMMEs
I'm told that companies such as Fiat and Parmalat are household names
in the Italian business world. These are among the many Italian companies that
have also become household names in our country, serving as living examples of
the success business story South Africa can and must tell. The number of joint
ventures between companies from both our two countries, particularly in our mining
sector, is encouragingly rising.
Indeed, South African companies also have
a good story to tell about the enormous business opportunities that Italy has
on offer. Companies such as SAB Miller, Sasol and Dimension Data are some of our
companies that have done very well in Italy. We are beginning to observe encouraging
signs that more and more South African companies are following the path charted
by companies such as Sasol.
The challenge is, of course, to narrow the balance
of trade, which is currently in favour of Italy, so as to ensure that our countries
benefit mutually from our trade relations. However, this should be done without
holding back the currently levels of investment from both our countries.
that context, our country stands to benefit from more and more investment from
Italy. As I have indicated above, ours provides one of the friendliest business
environments in the world. South African is ranked 28 in the World Bank Investment
This is a ranking earned on the basis of a solid and good
track record. The sound macro-economic management frameworks put in place since
1994 have lead to a steady economic growth. For the past 13 years, our economy
has been experiencing a positive growth, as opposed to the 20 years before 1994.
the past 3 years, we have been registering an annual growth rate of 5% and creating
500 000 jobs per annum. Government is confident that we will be able to achieve
our targetted annual growth rate of at least 6% as of 2008.
Infrastructure is the leading sector that is contributing to
the unprecedented economic growth that South Africa is currently enjoying. In
this sector there is a huge demand for capital goods. South Africa would welcome
collaboration with Italy the provision of these goods.
However, one of the
binding constraints that limit the growth trajectory is the deficit of skills.
This is particularly prominent in the engineering sector as well as artisans.
South Africa is also keen to work with Italy around initiatives that increase
government capacity. This would be for the greater goal of increasing service
delivery and of course reducing the bureaucratic red tape that often hinders international
In South Africa we have what is called a second economy.
This economy refers to those people of the population that have been unable to
participate in the formal economy, in other words, they are marginalised from
the mainstream economy. These are the people that SMME interventions are targeted
at. As previously mentioned, Italian business has a lot to teach South African
in the terms of SMMEs, and we look forward to that collaboration.
are a number of sectors where collaboration is feasible, such as the textile industry
and especially in clothing design. Furthermore, in the jewellery sector; Italy
is also renowned for its design there and South Africa is a pole player in the
raw materials of this industry.
Indeed, South Africa's future has never
looked brighter than it is today. It is for this reason that South Africans generally
describe this as the age of hope.
Our hosting of the FIFA Soccer World Cup
in 2010 is another show of confidence by the rest of the world in the organizational
capacity of South Africa. More importantly, the event holds and will certainly
open up limitless business opportunities for South Africans and investment partners
from all over the world.
I hope that the Italian Government will be as
ready as we are to offer assistance to Italian companies intending to do business
in South Africa.
It is true that things are not all rosy about South Africa's
socio-economic situation. A sizable proportion of our population still lives in
poverty - an unenviable legacy inherited from the paralysis and ills of the apartheid
economy. The encouraging fact, thought, is that the South African government has
acknowledged the challenges, studied the situation and devised practical programmes
that hold great prospects for the poor and the marginalized.
Key among the
challenges we have identified is the need to fast-track economic growth by addressing
identified binding constraints. In this regard, the government has, among others,
adopted a targeted intervention known as the Accelerated and Shared Growth Initiative
of South Africa (AsgiSA).
Asgi-SA, is specifically meant to deal with the
need to revamp our infrastructure and national logistics system, train South Africans
to impart skills needed in critical areas of our economy and create jobs in order
to ensure that our people have a better life.
We are under no illusions
that we can achieve all these objectives on our own. We have accepted the reality
that much as we must mobilize domestic investment, foreign direct investment remains
a critical factor in our ability to win the war against poverty, unemployment
and underdevelopment. It is for this reason that we are encouraged by the growing
levels of investment by Italian companies in our economy and look forward to even
International cooperation and conclusion
you know, South Africa has and continues to play an important role in peace-building
and conflict resolution and peacekeeping on the African continent. We do this
driven by our consciousness of the imperative to contribute to the advancement
of the African Agenda.
We are convinced that our actions will lead to
an African continent where underdevelopment will be history, political stability
and democratic governance the order of the day and economic prosperity a reachable
In this regard, we are encouraged by the good cooperation we have
had with Italy, bilaterally and in multilateral context such as the EU, the G8
and the UN. The emphasis placed by Italy on the importance of enhancing the institutional
capacity of the African Union (AU) is an objective that has seized the efforts
of the South African government since the AU came into being.
that our two countries are currently non-permanent members of the UN Security
Council is not a mere ignorable historical coincidence. It is a strategic opportunity
for our countries to advance a shared vision not only in African affairs, but
also in critical political and economic challenges facing humanity today.
the deepening relations between Italy and South Africa I have referred to through
out my speech, I have no doubt that ours is a relationship that will not only
defy the constraints imposed by distance and geographic space, but one that will
serve as the best example of true friends who act together in good and bad times.
I wish you success in your deliberations.
Thank you very much.
Presidency: Republic of South Africa