South Africa and France have discussed cooperation in different sectors with localisation and investment opportunities as cross-cutting themes as Dr Rob Davies, Minister of Trade and Industry met with French Minister of State for Foreign Trade, Matthias Fekl. Sectors identified by South Africa and France included engineering and industrial sub-contracting, energy and green energy, transport and agribusiness.
According to Davies, France is South Africa’s third largest trading and investment partner within the European Union.
“Total trade between South Africa and France has shown signs of recovery and increased consistently since 2010 to reach R33bn in 2014 from R23.6bn in 2009; a percentage increase of about 40%,” says Davies. 23,000 direct jobs have been created by French companies in South Africa.
Davies says the exports basket from South Africa to France includes value-added products such as vehicles, machinery, turbo-jets and parts thereof, and aircraft parts. Which is why, after numerous meetings, the France Joint Economic Committee was held under the presidency of Davies and Fekl.
“France wishes to deepen our partnership with South Africa, which is already of great quality, but can still be reinforced,” said Fekl.
Engineering and sub-contracting
The assembly of parts into intermediate products can be the focus for a growing number of South Africa exporters. This sector offers many opportunities for South African firms and the country has a large number of firms with capacities to supply this market from the following sectors: Metals processing, automotive components, electronics components and sub assemblies, and aeronautics components and sub-assemblies.
The French Minister indicated that many French companies were already working very closely with their South African counterparts, for instance in aeronautics, and underlined the need for greater collaboration on the African continent.
“South African knowledge and competences combined with French technologies could indeed result in a mutually beneficial situation, not only for the two countries, but also for all the region, especially in terms of industrialisation,” Fekl added.
To boost energy capacity, the South African government said it would continue procuring renewable energy, especially solar electricity and biofuels as it implements the Green Economy Accord. Programmes would be rolled out in independent power producer for base load coal projects, gas to energy projects and a co-generation IPP programme that is set to be issued later in 2015.
Accordingly, the French side expressed its wish to deepen the industrial cooperation existing in the energy sector with South Africa. While welcoming the confidence already granted by South African authorities to the French offer in terms of thermal energy, the French part underlined its wish to further cooperate in the fields of non-carbon energies (nuclear and renewable.)
The transport sector has been highlighted by the South African government as a key contributor to the country's competitiveness in global markets. The South African side reiterated the SA Government's commitment to spend significantly on new infrastructure in the coming years, focusing on rail and road projects, economic links in five regions in the country, new universities and refurbished hospitals.
France has already demonstrated its support for the development of transport sector in South Africa and would continue to do so, notably in the fields of aeronautics, train, urban, road and maritime transportation. Indeed, France is ready to go further her support through a cooperation agreement, which will help South Africa to strengthen capacity building.
Fekl praised the quality of the bilateral dialogue on agribusiness, and also called for a strengthening of bilateral cooperation in that field, both through industrial and institutional projects.
“We welcome the fact that the EU-SADC Economic Partnership Agreement initialled in July 2014 and pending a final signature will expand existing protected geographical indications on wines and spirits and would protect new food geographical indications.”
Davies responded saying, “The development of common research and training programs in South Africa should contribute to strengthen agroindustrial trade between our two countries.”
South Africa today aims to invest in a strong network of economic infrastructure designed to support the country's medium- and long-term objectives. Many French companies already partner with SA companies to address the infrastructure backlog in Sub-Saharan Africa but more could be done, especially in terms of investment in infrastructure, not only in South Africa, but also throughout Southern Africa and the African continent as a whole.
By Kristy Jooste