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Speech

Australian Minister for Trade, Mark Vaile

Black Management Forum and the
South Africa Australia Business Association
Johannesburg, 25 October 2000

Australia and South Africa: Strong Partners in Business

Introduction

This is my first visit to South Africa as Trade Minister, and my first visit to Johannesburg.  I am particularly pleased to attend this breakfast meeting jointly hosted by the Black Management Forum and the South Africa Australia Business Association.

Of course, meetings with counterparts in government are very important for any successful Ministerial visit.  But I think some of the most productive meetings for me are those that give me a chance to learn from people who actually contribute the substance to our commercial relationship.

Black economic empowerment

One of the major challenges facing South Africa is to find ways of enabling the previously disadvantaged sectors of society to have equitable access to business opportunities.  I commend the efforts the South African Government has already made to correct past injustices and social disadvantages, and note that it is currently considering its response to the report of the Black Economic Commission on this significant issue.

It is important that Australian companies understand and adapt to the changes taking place in business in South Africa.  One way they can assist the process of economic revitalisation here is by forming partnerships and investing in black-owned businesses, and today's breakfast is about exploring how Australian business can build such relationships to our mutual benefit.

I am aware that black companies are targeting industries like financial services, information technology, telecommunications, tourism and service industries, including catering, and facilities management and maintenance.  These are all areas where Australia has considerable expertise, and real value can be added by linking Australian and black South African companies.  For Australian companies, such linkages bring an extra benefit, because black empowerment companies can also provide them with a gateway to other African markets.

The Australian Trade Commission, Austrade, has been assisting this matching process by identifying key black management companies and introducing them to Australian companies.  Indeed, this joint meeting is a testimony to the synergy that can be created between the two groups.

South Africa Australia Business Association

I am also pleased that the South Africa Australia Business Association (SAABA) is co-hosting this function.  At a time when trade and investment links are expanding rapidly between our two countries, SAABA plays an important role in facilitating commercial linkages between South African and Australian business.

I understand that SAABA is newly constituted and is seeking to expand and broaden its membership.  The organisation provides a significant forum for discussion of issues affecting South African and Australian business and its program of activities will provide valuable networking opportunities for business participants.

South Africa-Australia economic ties

I've just come from Pretoria, where my colleague, Trade Minister Erwin, and I have wrapped up a very successful Joint Ministerial Commission meeting.  One of the things that gave us both good cheer is the very healthy state of the bilateral economic relationship.  Business ties are flourishing and two-way trade is highly diversified and growing, now standing at A$1.79 billion.  Two-way investment levels, now well over A$1 billion, are also strong.

South Africa, meanwhile, is one of our fastest growing markets for Australian Elaborately Transformed Manufactures, as well as a destination for our more traditional commodities and processed foods.  It also offers a gateway to the neighbouring regional market, to Southern Africa, indeed to Africa as a whole.  And in particular, it is the Black companies that offer expertise, experience and business networks in these neighbouring markets

A fine example of the benefits of closer economic cooperation between our nations can be found in the two-way trade in motor vehicles and components.  This industry shows how much our trade and investment relationship has matured, and that it is benefitting from new opportunities created by the effects of globalisation in opening niche markets.  The latest advance in this industry comes with the launch later this morningof the new Holden Chevrolet Lumina onto the Southern African market at the Auto Africa Expo2000, which I will visit following this breakfast.

I am also encouraged by the growth in two-way trade in services, which already exceeds A$400 million.  Typical of this growth is the opening of the new campus of Monash University at Roodepoort, which I attended on Monday.  This substantial investment by a highly regarded tertiary education institution like Monash is proof of the firm faith of Australians in the future of South Africa.  It will provide an excellent focus for further Australian interest in the proposed industrial park which will form part of the campus.

There are growing linkages, too, in other service industries - like the new South African company created by the Sydney-basedP & O Ports.  It had a turnover last year in the region of 90 million Rand and employs over 800 people.  The services sector is strong and vigorous in both our economies, and one where continued two-way investment would see considerable returns for both nations.  Macquarie Bank has recently opened a representative office in Cape Town.  This will help to match Rand Merchant Bank and INVESTEC which are already operating in Australia.

In fact, South African investment in Australia has become very significant, particularly in the mining industry.  That is a development we welcome.  Australians are beginning to invest more in South Africa, but both our governments would like to see a greater effort in this regard.  Our two nations are export competitors in some fields, including mining.  But we ought never to forget that competition can give rise to opportunities for cooperation, as increasing globalisation makes our world ever smaller.

Finally, I want to say a few words to the Australians in our audience.  I have spoken today about the good state of our bilateral economic relationship, and the great potential to expand trade even further.  But we cannot rest on our laurels.  The new Free Trade Agreement between South Africa and the EU, the enactment of the African Growth and Opportunity Act,and the launch of the Southern African Development Community (SADC) regional Free Trade Agreement on 1 September mean that competition will be fiercer than ever.  We must keep our eyes on the ball if we are to keep up in this market.

Conclusion

I don't want to take up any more time.

I know that the members of the Australian business mission who have accompanied me on this visit are very much looking forward to hearing from the representatives of the Black Management Forum on initiatives in Black Economic Empowerment and the opportunities that these present for Australian business.  I believe there is a good fit between what is needed and what Australia has to offer, and I encourage both sides to look carefully at imaginative ways of expanding our commercial relationship in this area.

Local Date: Saturday, 22-Nov-2008 04:22:09 EST