President Thabo Mbeki to Host Chancellor Gerhard Schroeder of Germany on an Official Visit, Pretoria, South Africa Wednesday, 21st - Friday, 23rd January 2004

President Thabo Mbeki will host German Chancellor Gerhard Schroeder for bilateral political and economic discussions in South Africa from Wednesday, 21 - Friday, 23 January 2004. The visit by Chancellor Schroeder, his first official trip to Africa, forms part of an extended tour to other parts of the continent - Ethiopia, Kenya and Ghana intended to demonstrate a strong commitment to the African Union (AU) and focus on peace keeping and capacity building efforts.

Chancellor Schroeder will begin his African tour with a visit to Ethiopia, where he will deliver an address at the African Union (AU) Headquarters, focusing on G8/AU relations.

The Chancellor's next stop will be in Kenya. He is expected to also pay a visit to the United Nations Environmental Programme (UNEP) Headquarters.

Chancellor Schroeder will then visit South Africa where his visit is expected to strengthen bilateral political relations; increase co-operation in labour and health issues; and consolidate business, cultural and sporting relations.

Bilateral discussions between President Mbeki and Chancellor Schroeder are expected to include, among others: the African Union (AU) and the New Partnership for Africa's Development (NEPAD); the Middle East peace process; the situation in Iran, Iraq and Afghanistan; the reform of the United Nations; the future of multilateralism including the World Trade Organisation talks; international peace and security; and the European Union.

President Mbeki is also expected to brief Chancellor Schroder on the restructuring of SADC; and regional peace processes in Burundi and the Democratic Republic of the Congo.

Members of the German Parliament, senior government officials and a large business delegation will be accompanying the Chancellor, including members of the Southern African Regional Initiative (SAFRI) that was formed to support economic development in the Southern African region (SADC). It is further envisaged that Chancellor Schroeder's visit would focus on strengthening cultural and sport ties with South Africa. This action is intended to support Germany's Southern African-German Cultural Weeks that will be held in South Africa during 2004, to coincide with the country's "Ten Years of Democracy Celebrations".

Chancellor Schroeder is expected to conclude his visit to Africa in Ghana, where he is scheduled to participate in the opening of the Kofi Annan Centre. A special feature of the ceremony will be the presentation of the German media prize to Mr Kofi Annan, the Secretary General of the United Nations.

Whilst in South Africa, the Chancellor will meet with representatives of the Nelson Mandela Foundation, the Southern African - German Chamber of Commerce and Industry, and COSATU.

Chancellor Schroeder will also pay a visit to the Stanza Bopape Memorial and Community Centre in Mamelodi, the Laepple Automobile Company in Rosslyn, as well as to participate in the announcement of the DaimlerChrysler Art Exhibition that is to be held at the Pretoria Art Museum.

Economic Relations

Germany has made substantial new investments and re-investments into the South African economy since 1994 and remains one of South Africa's most important international trading partners. At present Germany is South Africa's largest import partner and South Africa's fourth largest export partner. In addition, Germany had ratified the SA-EU Trade and Development Cooperation Agreement (TDCA) in 2001.

Major investments by German companies include companies such as BMW, DaimlerChrysler, Volkswagen, Siemens, Bayer and Ferrostaal. Considerable interest also exists among German groups and individuals to invest in hotels, restaurants, game farms, real estate and health resorts

Total bilateral trade has doubled since 1994 from approximately Euro 3.8 billion to Euro 7.6 billion in 2002 (100% growth). The growth of imports from Germany to South Africa in the period 2000 to 2002 was approximately 74%, whereas the growth of exports from South Africa to Germany during the same period was approximately 35%.

The total German investment (FDI) in South Africa stood at Euro 2.1 billion in 2001 whilst the net transfer of capital to South Africa during 2002 amounted to Euro 68 million. Approximately 450 German companies provide for nearly 70 000 jobs in South Africa and are mainly active in the automobile, chemicals, machinery, electronics, tourism and insurance sectors. South African firms that have invested in Germany are companies such as Minorco, Sappi, SASOL and ABSA.

German commitments towards development cooperation in South Africa, during the past ten years, amounted to approximately Euro 262 million in both financial and technical assistance.

South African imports from Germany (Note: Germany is SA's largest import partner):
2000 - R 24,880,982,000 (R 24,8 billion)
2001 - R 32,356,315,000 (R 32,3 billion)
2002 - R 43,155,758,000 (R 43,1 billion)

South African exports to Germany (Note: Germany is SA's 4th largest export partner):
2000 - R 16,448,109,000 (R 16,4 billion)
2001 - R 19,431,086,000 (R 19,4 billion)
2002 - R 22,172,003,000 (R 22,1 billion)

In recent years, several large German companies have proved their confidence in SA through an expansion of their operations in the country. The injection of additional investments has focused on the export of manufactured goods. In this regard, the export of the C-class right-hand drive Mercedes from East London, the Volkswagen Golf4 and Polo from Uitenhage and the BMW 3-series from Rosslyn near Pretoria are examples.

The tourism sector has been a major growth area with approximately 250 000 Germans visiting the country annually since 1997. Germany is one of South Africa's biggest source markets. South Africa has an approximate 3,5% share of Germany's annual long-haul tourism market and since September 11, 2001 it appears to be growing continuously.

Department of Foreign Affairs
Private Bag X152
Pretoria
0001

19 January 2004