Budget Vote Speech by the Minister of International Relations and Cooperation, H. E. Ms. Maite Nkoana-Mashabane, Cape Town, 3 May 2016
Honourable Deputy Ministers,
Your Excellencies, Ambassadors, High Commissioners and Representatives of International Organisations, Colleagues, Distinguished Guests,
Ladies and Gentlemen,
We are honoured to present this Budget Vote Speech in this year of the 40th Anniversary of the Soweto Uprising. We pay tribute to the 16 June 76 generation whose brave actions led to the declaration of apartheid as a crime against humanity by the United Nations (UN), and triggered a ground swell of international solidarity against the apartheid regime. For this, we shall remain eternally grateful to the international community for their role in the struggle against apartheid, and the birth of a new democratic South Africa.
This is also the “Year of Human Rights with specific focus on Women’s Rights” as declared by the Heads of State and Government during the African Union (AU) January 2016 Summit.
Women’s rights are human rights. It coincides with the 60th Anniversary of the historic march by the women of South Africa against inhuman, unjust and discriminatory apartheid laws. In this regard, we reaffirm the centrality of human rights in our foreign policy and recommit ourselves to intensify our efforts at the promotion and protection of women’s rights in particular.
Ladies and Gentlemen,
During the State of the Nation Address on 11 February, President Jacob Zuma underscored the centrality of the National Development Plan (NDP), the overarching apex policy framework that guides the work of the fifth administration.
In the area of international relations, the NDP states:
“… in order for South Africa to achieve its national goals of eradicating poverty, lowering inequality, creating jobs and making transition to a resilient carbon economy, foreign relations must be driven by the country’s domestic economic, political and social demands, as well as our regional, continental and global obligations.”
In pursuance of this injunction, the Department of International Relations and Cooperation (DIRCO) has translated the NDP goals into a strategic programme that seeks to:
- sustain political, economic and social relations
- strengthen political and economic integration and development of the Southern African Development Community (SADC)
- consolidate the African Agenda
- strengthen and consolidate South-South relations
- leverage relations with the North in advancement of national and continental priorities and agenda of the South
- advocate for the reform and strengthening of the global system of governance.
We live in a turbulent world characterised by economic crisis on the one hand and political conflict on the other. These twin global challenges pose a serious threat to peace and development in the world. Peace and development are two sides of the same coin. According to the UN’s 2016 “World Economic Situation Prospects” publication, the global economy is expected to grow sluggishly by a mere 2,9 per cent in 2016 and 3,2 per cent in 2017. The global economic downturn has forced many governments to adopt fiscal consolidation measures side by side with stimulus packages.
South Africa is one of the developing countries whose economics are fully integrated in the global economy, hence the impact. This budget we are presenting here today incorporates the budget reduction of R153 million in the 2016/17 financial year and that will amount to a R1,8 billion reduction over the Medium Term Expenditure Framework (MTEF).
The hard choice before us in the light of these budget cuts, are to close down some of our missions as some have suggested and face the reality of losing momentum on the gains we have achieved as evidenced by increasing trade and investments.
DIRCO has been at the forefront of coordinating the country’s response to these challenges. Part of our response to this changing global economic landscape has been to identify economic development opportunities for South Africa.
In this regard, DIRCO has been central to the coordination of South Africa’s economic diplomacy programme. In anticipation of growth in both the African and Asian regions, we took a conscious decision to expand and strengthen our diplomatic missions in the two regions.
We increased our presence on the continent from seven diplomatic and consular missions in 1994 to 47 in 2015. Consequently, South Africa’s trade on the continent increased 39 times from R11, 4 billion in 1994 to R385 billion in 2015. We are targeting half a trillion rand trade with Africa by 2019. As at the end of 2015, 20% of our trade was conducted within the African continent.
With regard to Asia and the Middle East, South Africa’s trade and investment in these regions have grown considerably and continue to do so. In 1994, trade with Asia and the Middle East combined was approximately R45 billion and has increased to approximately R760 billion for Asia and R116 billion with the Middle East. Working together with other government departments, we can achieve a trillion rand trade with this region by 2019.
Based on the above, it can be deduced that there is a direct correlation between the growth of South Africa’s diplomatic missions and the phenomenal expansion of our trade and investment relations on both the African continent and in Asia and the Middle East. The same applies to the Americas and Europe. With additional economic diplomacy efforts and enhanced national coordination, South African trade with the world can reach R2 trillion by the end of this administration. Without a doubt an unprecedented trade expansion!
At the same time, as we explore new markets, we continue to maintain close economic ties with the industrialised economies of the North which provide, inter alia, preferential market access to some of South Africa’s exports. Enhancing the economic and political dialogue is an important part of our economic diplomacy strategy as they remain a primary source of Foreign Direct Investment and Official Development Assistance flows into South Africa.
In addition to the economic uncertainties we face, the global security situation has become more precarious in the recent past. We have witnessed with concern growing extremism, increased acts of terrorism and intra-state conflict in various regions across the world, including the Sahel. The long-standing conflict in Syria and the instability in Libya are but examples of the conflict. These developments have led to an increase in migration flows as people flee the consequences of conflict. It is important that the root causes of migration are addressed, especially the impact on women and children.
Our development is intertwined with that of the southern Africa region and the African continent at large. Hence, our renewed efforts at ramping up industrialisation should be viewed within the overall framework of the SADC Industrialisation Strategy and Roadmap as approved by the SADC Extra-Ordinary Summit in April 2015. We seek to industrialise the regional and continental economies in order to develop our own manufacturing capacity.
We also seek to radically alter the colonial/post-colonial pattern where Africa was a supplier of raw materials. Africa should produce value-added goods for exports into the global economy. It is only in this way that we can address the paradox of a rich-resource continent inhabited by a poverty-stricken population, and make a decisive break with the past!
In pursuit of the continental economic integration agenda, we have witnessed the launch of SADC, Common Market for Eastern and Southern Africa (COMESA) and East African Community (EAC) Tripartite Free Trade Area (FTA) in June 2015 in Egypt. This FTA, which merges 26 countries into a free trade zone with 625 million people and a total gross domestic product (GDP) of 1,6 trillion US dollar, will contribute immensely towards increasing intra-African trade. The Tripartite FTA represents an important milestone towards the conclusion of negotiations for the establishment of the Continental Free Trade Area.
Led by President Jacob Zuma, the AU Assembly unanimously re-elected South Africa for a second consecutive two-year term to the AU’s Peace and Security Council. This gives us the opportunity to consolidate the work done in the past two years, including contributing to the implementation of Agenda 2063’s goal of “Silencing the Guns by 2020.”
South Africa will intensify its diplomatic efforts to help bring about lasting political solutions in Lesotho, Burundi, South Sudan and the Great Lakes region.
Allow me to take this opportunity to commend the outgoing AU Commission Chairperson, Dr Nkosazana Dlamini Zuma, for her admirable leadership, in particular the conceptualisation of Agenda 2063, which has since been adopted as the continent’s vision – the “Africa we want”. Her emphasis on continental self-reliance in funding the AU’s programmes and projects will be one of her enduring legacies. Lastly, we salute Dr Dlamini Zuma for her tireless work which has resulted in a marked improvement in the working methods of the AU.
Ladies and Gentlemen,
In pursuit of the NDP goals, particularly concerning energy security, we have engaged in mutually beneficial partnerships with the Democratic Republic of Congo (DRC).
I am happy to report that the Memorandum of Understanding between South Africa and the DRC on the Grand Inga Project signed in 2011 has entered into force. This project, when completed, will be a significant addition to South Africa’s energy mix, contributing 15 000 megawatt to the national grid.
Honourable Members, Your Excellencies,
The African continent continues to leverage relations with strategic partners such as China in order to achieve its developmental objectives as set out in Agenda 2063. In this regard, the first-ever summit-level meeting of the Forum on China-Africa Cooperation (FOCAC), held on the African continent in Johannesburg, focused on the objectives of Agenda 2063 and the China Two Centenary Goals. China pledged US60 billion for Africa’s skills training, socio-economic and infrastructure development from which South Africa and the continent at large will benefit.
Ahead of the FOCAC meeting, Chinese President Xi Jinping undertook a State Visit to South Africa, culminating in the signing of 23 agreements amounting to close to R100 billion.
Our cooperative partnerships with emerging economies complement other existing platforms which we utilise to pursue the African Agenda. Since we joined the Brazil, Russia, India, China and South Africa (BRICS) formation, Africa’s developmental needs and aspirations have been fully incorporated into the BRICS agenda. The BRICS’s New Development Bank (NDB), headquartered in Shanghai, has recently started operations and its African Regional Centre will be located in Johannesburg.
As has been reported, the NDB has approved its first tranche of projects in April 2016. Each member state has been allocated a project to implement and South Africa has been allocated 180 billion US dollar for renewable energy. Through this decision, the NDB has commenced to discharge its mandate, namely: the funding of infrastructure projects that promote sustainable development. Africa’s partnerships with the United States of America, India, Korea and Japan are also yielding positive socio-economic results.
In the spirit of mutual beneficial global cooperation, we will continue to participate actively in the Group of 20 (G20) processes in our capacity as Co-chair of the G20 Development Working Group.
Ladies and Gentlemen,
As the chairperson of Group of 77 and China, South Africa was at the forefront of articulating and promoting the collective economic and developmental interests of the South within the UN System. We coordinated the G77 and China positions in the negotiations for the “2030 Agenda for Sustainable Development”, which was adopted at a UN Summit in September 2015, and during the third International Conference on Financing for Development, which resulted in the “Addis Ababa Action Agenda”.
We are satisfied that the 2030 Agenda is all encompassing in that it addresses the three dimensions of sustainable development namely; the economic, social and environmental dimensions, and is aligned to the AU’s Agenda 2063 and our own NDP.
Concerning the climate change negotiations, South Africa utilised its tenure as the Chair of the G77 and China to engender a paradigm shift from the mitigation-centric approach to a holistic and comprehensive approach in order to meaningfully address climate change. In this regard, the historic Paris Agreement and the package of supporting decisions covering climate action in the pre- and post-2020 periods mark the successful conclusion of a four-year negotiation process under the Durban Platform for Enhanced Action initiated by South Africa in 2011.
South Africa signed the Paris Agreement at the UN Secretary-General’s high-level event in New York on 22 April 2016 and will commence with the domestic processes required for ratification.
Having concluded our mandate as Chair of the G77 and China in January 2016, we would like to take this opportunity to express our gratitude to members of the group for their support and cooperation.
Honourable Members, Ladies and Gentlemen,
We remain convinced that the UN is the pre-eminent organisation for the maintenance of global peace and security and the advancement of development. We will therefore continue to advocate for its reforms, particularly the reform of the UN Security Council to ensure that this body is both responsive to the needs of developing countries and is truly representative of the current global realities.
Ladies and Gentlemen,
Having said this, DIRCO will intensify efforts to ensure cohesion and better coordination of South Africa’s international engagements. I am convinced that we can avoid duplication of efforts and maximise the benefits deriving from our coordinated international engagements. In this regard, we will take deliberate measures to impress upon all stakeholders to implement the “Measures and Guidelines for the Enhanced Coordination of South Africa’s International Engagements.”
As you may recall, I announced in the previous Budget Vote that a South African Council on International Relations (SACOIR), comprising of leaders from academia, business, labour and civil society, will be launched. I am pleased to inform you that SACOIR was launched in July 2015 and since its inception, the council continues to provide valuable input and advice in our international relations engagements.
Our diplomatic efforts have not gone unnoticed. South Africa has recently been conferred the Distinguished Diplomatic Service Award from the World Affairs Council in Washington, DC for “outstanding commitment to global education, international affairs and global communications.”
I would like to take this opportunity to thank the Honourable Chair and the Honourable Members of the Portfolio Committee on International Relations and Cooperation for their support and cooperation.
Let me extend a word of gratitude to my Cabinet colleagues in the International Relations and Cooperation, Trade and Security Cluster for their guidance.
Last but not least, I would also like to thank the two Deputy Ministers of International Relations and Cooperation for their work in promoting South Africa’s international relations programme at home and abroad.
Finally, allow me to thank the Director-General, senior managers and staff of the department for the execution of decisions on South Africa’s international relations programme.
The following words of President Nelson Mandela addressing a Joint Sitting of Parliament to mark 10 years of democracy still ring true: “In a cynical world we have become an inspiration to many. We signal that good can be achieved amongst human beings who are prepared to trust, prepared to believe in the goodness of people.”
I thank you.
ISSUED BY THE DEPARTMENT OF INTERNATIONAL RELATIONS AND COOPERATION
OR Tambo Building
460 Soutpansberg Road