President of the Republic of South Africa and Incoming Chair of SADC, on the occasion of the 37th SADC Summit of Heads of State and Government, Pretoria
19 August 2017
Your Majesty King Mswati III
Your Excellencies Heads of State and Government
Executive Secretary of SADC
Ladies and Gentleman
I AM truly honoured to welcome you, the leaders of our regional family of nations, to the Republic of South Africa for the 37th Ordinary SADC Summit of Heads of State and Government.
As is our tradition, we use the Summit meeting as our platform to review and deliberate on the year’s work programme, to take stock of progress and to identify and discuss remaining challenges.
This year the Summit symbolises an important year for SADC since it marks the Silver Jubilee (25 years) celebration of the SADC as an organisation and as a result represents an important milestone for all of us.
We are also delighted to host this Summit in this iconic building which is correctly named after Oliver Regional Tambo, one of the outstanding leaders South Africa ever produced.
Our government has declared 2017 the “Year of OR Tambo” in celebration of his life. OR Tambo was a great proponent of regional unity and prosperity.
On the occasion of the Twenty First Anniversary of the United Nations Economic Commission for Africa in April 1979 in Lusaka, OR Tambo had this to say:-
“The struggle for national liberation in Southern Africa and those of countries of independent Africa for economic liberation and development are indeed the same struggle”.
In addition and apart from our geographic bond, our region also has strong historic relations and many shared values and cultures.
Many of our countries also formed part of the Front Line States, which played a key role in our liberation struggle from colonialism to democracy and majority rule.
Today I am happy to say that our region shares many achievements including the strengthening of good governance, consolidation of our democratic institutions and the holding of regular elections.
We congratulate the people of Lesotho for the peaceful election and we are wishing the people of Angola well on the elections scheduled for the 23rd August 2017.
We are meeting under an environment that is stable as prosperity and development are inextricably linked to political and security stability.
Excellencies, ladies and gentlemen
The International Monetary Fund (IMF) in its regional economic outlook for Sub-Saharan Africa has forecasted a modest rebound in aggregate growth of 2.6 percent in 2017.
The economies of the countries in the region continue to be under severe economic difficulty owing to the 2008 global financial crisis and the accompanied decline in global demand for commodities.
The rising public debt as a percentage of GDP driven mainly by the budget deficit puts a further constrain in access to the much needed capital to fund regional projects in particular, the much needed infrastructure as the debt service cost burden increases.
Global uncertainty persists with the indication that countries in the world economy are inward looking with evidence of some taking a policy stance which could be characterised as push backs on globalisation. It is therefore imperative that the region focuses inwardly.
African economies are small by global standards, therefore a collective response through regional integration is essential for structural transformation of our economies. The region cannot continue to be suppliers of primary products in global value chains and low levels of domestic production with economies that are very vulnerable to global shocks.
In line with the global development agenda on sustainable development, the SADC has under the chairship of Zimbabwe, developed the Regional Industrialisation Strategy and Roadmap (2015-2063) as an inclusive long-term modernisation and transformation mechanism.
The industrial strategy and the road map sets out three potential growth paths which are:
• Mineral beneficiation and
• Manufacturing (downstream processing and industry and service sector value chains.
The SADC’s goal is to improve and establish manufacturing capacity, productivity and competitiveness in these sectors.
The the implementation of these will ensure successful transformation of regional economies from the commodity dependent growth path to a production induced growths.
This will not only raise the living standards of our people but also facilitate the rapid catch-up of the SADC countries with industrialised and developed countries.
South Africa therefore intends to advance progress made by the previous SADC chairpersons. It is of central importance to SADC to add value to our resources and to grow our intra-regional trade and our regional brand.
The key activities during our Chairship will be the development of a high impact Annual Operation Plan with targeted interventions and public policy tools to foster the development of regional value-chains in agro-processing, pharmaceuticals and mineral beneficiation.
Secondly, we will promote a Member State driven process through the Industrial Development Forum to facilitate the identification of cross-border projects that will strengthen regional value-chains and contribute to the development of the region.
The achievement of this requires a functional regional market which is key to facilitate investment.
We will need to ensure that we find an effective way of promoting a rules-based trade environment that promotes certainty and stability. The implementation of commitments under the Trade Protocol have to be an integral part of this agenda so as to create an integrated market that is conducive to the development of regional value chains.
As a contribution towards capacity building, South Africa will in addition to the initiative started by Swaziland on the establishment of the University of Transformation, introduce a new programme to develop capacity in industrial policy making and implementation for senior officials in the SADC region.
As you would know, Infrastructure is the key driver of industrialisation.
An important gap identified by both the public and private sectors is the lack funding to develop bankable projects.
In addition, infrastructure investment is a catalyst to economic transformation and industrial development.
We therefore need to leverage infrastructure spent to fast track the process of structural transformation in our economy.
Currently, the nature of funding or loans from the International Cooperative Partners is such that the conditions imposed ensure that benefits yield to the lending countries.
The loans come with conditions that dictate which companies to use in project implementation and sometimes even dictating the sourcing of raw materials.
There is a need to mobilise regional resources to fund regional projects.
This is a key element towards the region’s ambitions of having its own Regional Development Fund.
Furthermore, Esteemed Excellencies, food security remains a critical component of our developmental path. Over the past few years we have experienced natural disasters and felt the impact of trans-boundary pests such as the Fall Army Worm and Tuta Absoluta.
These have had an impact on food security. South Africa will be working closely with the SADC community in developing and rolling out a model, in terms of prevention, surveillance and in dealing with destructive invasive species.
The Food and Agricultural Organisation (FAO) and other related organization in SADC will constitute a process to roll out the model throughout the region.
Your Excellencies, taking the lead from our previous Chair, the Kingdom of Swaziland, I would like to emphasize the need to promote region-wide integrated energy planning and cooperation in the development of priority energy infrastructure and maintenance projects, with the view to attract private sector investment.
One of the potential game-changers for the region is the discovery of globally significant natural gas resources both onshore and offshore in a number of our member states.
As a new initiative, we are proposing the establishment of an Inter-state Natural Gas Committee to share learning for regional gas development and to prepare for the development of the wider gas economy.
As such, the inclusion and promotion of gas into the regional energy mix will facilitate an increase in universal access to energy, as well as industrial development in SADC.
Ladies and Gentlemen, the South African theme for its chairship year is “Partnering with the Private Sector in Developing Industry and Regional Value Chains”.
This theme seeks to promote momentum and continuity in our collective aspiration towards regional sustainable economic development and industrialisation.
We further believe that joint focus on these deliverables which are mechanisms through which our region’s trade potential can be harnessed to the benefit of our people will ensure successful implementation.
Our cooperation as a region will allow our economies to overcome the challenge of small, fragmented economies, and create a larger market that improves the region’s prospects to attract investment.
We will also need to work together towards the objective of broadening integration through the establishment of the Tripartite Free Trade Area, and the Continental FTA.
I am pleased to inform this August gathering that South Africa has recently appended its signature to the agreement establishing the TFTA, thereby becoming the 19th Member State out of the 26 nations to do so.
This augurs well for our long standing decision to support regional economic integration.
South Africa will also, during its Chairship, prioritise the conclusion of the Trade in Services negotiations in SADC.
The prioritised sectors include construction, communication, transport, finance, energy and tourism.
This will put the SADC region in a firm position to engage in the Continental FTA negotiations.
Ladies and gentleman, may I once again welcome you all to the Republic of South Africa and trust that you will have a very fruitful visit.
It is my hope that this Summit, and our celebration of twenty five years as SADC, will be a time for reflection and renewed cooperation towards our shared common future of a prosperous and peaceful SADC region.
I thank you.
Issued by The Presidency