South African Business 2019 edition

SPECIAL FEATURE
This means that the potential for South Africa to grow its exports into
other parts of Africa is enormous, if the infrastructural obstacles can
be overcome.
The Southern African Development Community (SADC) is a
16-member inter-governmental organisation with its headquarters
in Gaborone, Botswana. Other members include South Africa, Lesotho,
Malawi, Namibia, Tanzania, Comoros and Mozambique.
SADC is one of several regional organisations on the continent and
there have been moves in the past for cooperation between these
bodies. For example, a tripartite summit was held between the leaders
of the Common Market for Eastern and Southern Africa (COMESA), the
East African Community (EAC) and SADC. The AfCFTA may supercede
these agreements as it applies to all of Africa.
SADC’s theme for 2018/19 is “Promoting Infrastructure Development
and Youth Empowerment for Sustainable Development”. This is an
extension of the body’s focus on industrialisation, while also putting
the focus on infrastructure development, youth empowerment and
sustainable development.
The 38th summit of SADC held in Namibia in 2018 approved the
creation of the SADC University of Transformation, in the form of a
virtual university. This is further intended to support industrialisation
through subjects such as technology transfer, innovation, digital
and knowledge economy, entrepreneurship, commercialisation and
enterprise development. SADC has a Revised Regional Indicative
Strategic Development Plan (RISDP) 2015-2020, which deals with
industrialisation, regional infrastructure, agriculture and strategy.
Corridor development is an important part of growing intra-African
trade. Within the corridors of development, red tape and infrastructure
are other key elements.
South African retailer Shoprite spends about R20 000 per week in
permits, and long waits at border posts are routine. But the Chirundu
one-stop border post in Zambia has reduced transit times by a third.
Passenger transport delays have been reduced from three hours to
30 minutes and freight is now cleared in one day instead of three.
A number of corridor projects are in the pipeline or have already
been implemented. The Maputo Development Corridor has successfully
linked the thriving industrial and business centre of Gauteng Province
in South Africa with the Mozambican port city of Maputo. The idea
of corridors has been adopted by the Infrastructure Consortium for
Africa (ICA), and several corridors have been conceptualised since that
decision, for example the Northern Corridor of Central and East Africa.
A corridor strategy relies on infrastructure, with inter-related plans
being developed involving the upgrading and standardisation of
facilities at ports, railway lines, customs posts and energy projects.
South African rail, ports and pipeline operator Transnet is already
very active in African countries north of the South African border and
is intending to offer its services more widely.
The Sustainable Development
Investment Partnership (SDIP)
comprises 30 institutions which
aim to see 16 African infrastructure
projects (valued at more
than $20-billion) carried out. The
founders of the SDIP were the
World Economic Forum (WEF) and
the Organisation for Economic
Co-operation and Development
(OECD) and other members now
include the Bill and Melinda Gates
Foundation, the Senegal Strategic
Investment Fund (FONSIS), the
US Agency for International
Development (USAID), the
Industrial Development
Corporation of South Africa (IDC)
and the Development Bank of
Southern Africa (DBSA).
The Export Credit Insurance
Corporation of South Africa
(ECIC) exists to help trade and
investment across borders. ECIC
can provide insurance for bank
loans that are taken by investors
and South Africans can get insurance
for investments and for small
and medium enterprises there is
a product available (performance
bonds to anyone exporting
capital goods and services.
The South African Department
of Trade and Industry plays a key
role in terms of promoting trade
between South Africa and the
rest of Africa, but also supports
regional bodies such as SADC
and promotes the kind of integration
contained in the plans of
the New Partnership for Africa’s
Development (NEPAD) and the
African Union’s Agenda 2063. The
dti’s Africa Export Council (AEC)
was inaugurated in 2016 with the
goal of promoting South African
products and services in Africa.
45 SOUTH AFRICAN BUSINESS 2019