Branding, Trade and Investment Mission to the US
Speech by IMC chair Wendy Luhabe, describing the IMC's high-powered trade delegation to the USA in June to brand South African business abroad
We have travelled to the US to share South Africa's unfolding story after our first ten years of democracy and transformation. Our success as a nation is a collective effort of a people working collaboratively towards the growth and development of South Africa and the African Continent. This is South Africa's first business Branding, Trade and Investment Mission to the US and we comprise of more than 40 diverse and remarkable business people and thought leaders in various fields including about ten women business leaders in the delegation. We represent industry and commerce, the Reserve Bank, Stock Exchange, Emerging Entrepreneurs, Resources, Technology, Manufacturing, Engineering, Electronics, Industrial Development, Construction, City Branding and Management, Hairdressing, Tourism, Wine Industry, Financial Services, Banking, Trade and Investments, as well as South Africa's first Industrial Zone Development for Africa's first deepwater port as part of our economic strategy to improve the international competitiveness of South Africa and Africa as an investment destination.
We have a diverse, productive and industrialised economy with many first world characteristics. We are committed to free market principles and practise the highest level of Corporate Governance in both the Private and Public sectors. Our first five years of democracy under the leadership of President Mandela focused on national reconciliation, establishing a world admired constitutional framework and creating institutional capacity to underpin South Africa's young democracy.
The second five years under the leadership of President Mbeki shifted focus towards creating a sound fiscal policy and macro economic stability, a market driven economic plan and positioning South Africa in the Global Community.
In 1994 the new government inherited a bankrupt economy and a legacy of unprecedented social distortions that had been neglected for more than 300 years. As a result of uneven distribution of income and wealth opportunities we face huge challenges with poverty, education, unemployment, housing and health care.
The next five years under President Mbeki's last term in office will focus on addressing these challenges a lot more aggressively and comprehensively now that the economic initiatives that achieve sustained economic growth and development. In order to boost economic growth and spur job creation, the government has launched special investment corridors to promote development in specific regions that have been neglected in the past, as well as an integrated approach to encourage small, medium and micro enterprise development.
One of the great successes of the last ten years has been to reduce consumer inflation from double digits for more than 20 years to under 6%. We inherited an apartheid debt which we have honoured and that means we have created a stable financial environment. The economic and business decisions that we have taken over the last ten years have not mortgaged our future. That is why we are here, to raise the business profile of our economy because we are now open for business.
South Africa is a member of the World Trade organisations and we have a US - SA Bilateral Tax Treaty that has been in place since January 1998, a Bilateral Trade and Investment framework agreement that was signed in February 1999. US products qualify for South Africa's most favoured nation tariff rates and we are eligible for the benefits under the African Growth and Opportunity Act, which means that most of our products can enter the United States market duty free. Hopefully you already know all of this.
We have some of South Africa's major industrial companies listed on the NYSE - Telkom, Harmony Ashanti, Anglo American, Sasol, Sappi and that is why it was such a highlight for the NYSE to declare Monday South Africa day and give us the opportunity to ring the opening bell.
We have just recently been awarded the 2010 Soccer World Cup after ten years of hosting major events that have included the Rugby World Cup, Cricket World Cup, World Summit on Sustainable Development and the President's Cup for golf. This we believe is a major vote of confidence and endorsement by the first world. Whilst we have a market of about 42 million people we infact are the gateway to a market of more than 900 million people three times the size of the US market. The US is one of South Africa's key trading partners in the world today and our bilateral trade relationship has maintained a consistent pattern of expansion since 1994. By 2001 the US was South Africa's largest single trading partner in the world, totalling about $7.25 billion. The US currently represents an exports destination for 12 - 15% of all South Africa's exports.
Since 1994 the US has consistently been the largest foreign direct investor in South Africa, representing about 40% of total FDI since 1994. From all the new US companies that have been established and the ones that have returned since the US sanctions were lifted, the US Embassy in SA estimates that approximately 900 US companies operate directly or indirectly in South Africa employing about 125 000 people.
In conclusion, South Africa's broad economic themes over the next ten years will focus on Growth, Reconstruction and Development of the economy in an innovative but sustainable manner. In ten years, South Africa's achievements in creating a society defined by our constitution is an inspiration to many parts of the world, we are here to share that story and invite you to come and invest in South Africa. We are here to further cultivate a mutually fruitful and productive partnership between our two nations, to strengthen our relationships because for us business is about people. We have arranged a series of panel presentations to provide you an overview of the various sectors that are represented by the delegation. We hope that after these presentations we can engage in a rigorous discussion about concerns you may have to enable us to raise your level of understanding about the opportunities that are available in South Africa. South Africa is Alive with Possibility.