KwaZulu-Natal is open for business to Indian investors who stand to benefit from comparative advantages between the two nations and can be assured of the future political and economic stability of South Africa despite some “ill-informed” perceptions.
This was the word from MEC for Economic Development, Tourism and Environmental Affairs, Sihle Zikalala, who addressed international delegates at the World Tamils Economic Conference in the city on Friday.
Zikalala assured delegates of the government’s commitment to policy certainty in light of December’s ANC National conference, where the policy trajectory of the country will be decided and office-bearers will be elected.
“These processes, by their very nature, bring with them a heightened level of excitement because, as leader of society, all of our people have an interest in knowing what policy stances the ANC will adopt in taking forward our revolution,” he said.
“We want to assure the international community, including delegates to this conference, that both the ANC and South Africa are stable. There is policy certainty in South Africa. There is both socio-economic and political stability in South Africa. In this regard, we would want to dissuade delegates to this conference from engaging with South Africa and her economy on the basis of ill-informed perceptions rather than hard facts,” Zikalala said.
Zikalala said India was an important trading partner for South Africa, and KZN in particular. India is South Africa’s seventh largest trade partner and bilateral trade between the two countries was expected to reach $18 billion by 2018.
“Imports from India account for 4% of the total imports into the country, while imports from China account for approximately 20%. These statistics tell us that more can be done to bolster trade between our countries if we look at the existing relationship and the fact that South Africa boasts one of the highest concentrations of Indians outside of India,” Zikalala said.
He said comparative advantages exist between South Africa and India, which formed the basis of trade between the countries.
“South Africa has a comparative advantage in various primary sector commodities, for example metal ores, gold and coal, whereas India has a comparative advantage in various secondary sector commodities like textiles and other manufactured products.”
Zikalala said South Africa’s partnership with India in Brics had laid the groundwork and ensured relations fostered coexistence in a symbiotic manner.
Imports from India account for 4% of the total imports into the country… KZN MEC for Economic Development Sihle Zikalala believes economic co-operation between the SA and India can be improved.
Picture: Bongani Mbatha/ANA
“The South-South co-operation agreement presents substantial potential for trade growth between ourselves and India, especially considering that over the past decade, Afro-Indian trade has more than doubled from $25bn to an estimated $70bn,” Zikalala said.
“This is a window of opportunity for us to export value-added products into the Indian market and to explore joint-venture opportunities with Indian companies for investment projects, in line with the broader objectives of developing our country’s economy.
Zikalala said the roll-out of focused special economic zones and industrial hubs throughout the province presented boundless opportunities to enhance the relationship in the fields of telecommunications, IT, energy, ocean economy and the automobile sector.
“These sectors are crucial to our efforts of up-skilling our youth and lifting the millions of our people, not least of all our women and youth, from the abject conditions of poverty, inequality and unemployment,” he said.
Zikalala highlighted the shift in global economic balance from traditional economies in the West to emerging economies. According to the UN Conference on Trade and Development’s special edition of the Global Investment Trends Monitor, since 2010, developing and transition economies have absorbed more than half of global foreign direct investment, exceeding those to developed countries – with $130bn – for the first time ever in 2012.
“Brics countries are explicitly recognised as having played an important role in the current pattern of global investment, accounting for nearly a tenth of global investment outflows. It is imperative that as trading partners and members of the Brics bloc, we continue to work together with India to expand bilateral trade relations between the two countries.”
Zikalala said creating an environment conducive to private sector investment and job creation was a top policy priority.
“The province has an investment strategy which explicitly identifies fostering a conducive investment climate as one of the most fundamental prerequisites for promoting investment growth,” Zikalala said.
In line with this, President Jacob Zuma on Saturday launched the KwaZulu-Natal One Stop Shop for Investment, a single clearing house where investors can under one roof access assistance from all relevant government departments when they want to make an investment.
“It will cut the red tape and the unnecessary bureaucracy that may make it difficult for investors to invest,” Zikalala said.
Investors can also benefit from Special Economic Zones (SEZs) such as Dube Trade Port, which focuses on agro-processing and green technology development, and Richards Bay Industrial Development Zone, which targets minerals and metal beneficiation.
“The SEZs will house satellite One Stop Shops to assist in the ease of doing business by hastening the approval of applications. We urge investors to take advantage of our bulk infrastructure programmes in these two SEZs where we are making available some 50 hectares of industrial property for investment in 2018.”
“KwaZulu-Natal is ripe and ready for new massive infusions of investments. The province has all it takes to guarantee a competitive, emerging, vibrant market and investment area,” Zikalala said.