Deputy Minister Aziz Pahad to Pay Official Visit to the Middle East, Monday, 23 August - Thursday, 2 September 2004

Deputy Minister of Foreign Affairs, Aziz Pahad will pay an official visit to the Middle East from Monday, 23 August to Thursday, 2 September 2004 during which he will visit Iran, Syria, Jordan and Egypt.

Issues on the agenda include the consolidation of bilateral political and economic relations between each of the countries and South Africa, support for NEPAD as the socio-economic programme for the African continent, the Middle East Peace Process, and developments in Iraq following the handover of sovereignty to the people of Iraq

Discussions will also focus on the three major challenges outlined by President Mbeki earlier this week at the opening of the Non Aligned Movement (NAM) Ministerial meeting in Durban:

• Poverty and under-development
• Peace and security, and terrorism
• Restructuring of the global exercise of power.

Iran (Tuesday, 24 - Friday, 27 August 2004)

In Iran, Deputy Minister Aziz Pahad will meet with the

• Foreign Minister, Dr Kamal Kharazzi;
• Deputy Minister responsible for Afro-Arab Affairs, Dr Seyed Mohammed Sadr;
• Dr Hassan Rowhani, Secretary-General of the Iranian Supreme National Security Council; and
• Members of the African Diaspora in Iran.

Bilateral Relations

Since the resumption of diplomatic relations in 1994, there have been a number of high-level visits to and from both countries. The former Iranian President, Ali Hashemi Rafsanjani and his successor, President Mohammed Khatami, have both visited South Africa, the latter to attend the NAM Summit in Durban in 1998.

A Joint Binational Commission (JBC), which concentrates on co-operation in the economic, agricultural, mining, scientific, arts, culture, sport and education fields, has met annually since 1996. The 8th JBC is scheduled to be held in Tehran on 29 - 30 November 2004.

The 7th session of the JBC saw the establishment of the Iran-South Africa Business Forum aimed largely at reducing the substantial imbalance in bilateral trade.

Multilateral Relations

On the multilateral front, South Africa has had an active interaction with Iran in the furtherance of the Non-Aligned Movement's (NAM) objectives. Both South Africa and Iran during the 6th Joint Bilateral Commission placed emphasis on multilateral issues and to advance the concepts of NEPAD and Dialogue among Civilisations, a programme to promote international ties favoured by President Khatami. Both sides also called for closer cooperation among member states of the SADC and the Economic Cooperation Organisation (ECO), which is headquartered in Tehran.

Chaired by the Iranian Deputy Minister of Foreign Affairs, Dr. M Adeli, the Iranian Foreign Ministry hosted the 1st session of the Iran-Africa Co-operation Forum in March 2003. The purpose of the meeting was to find ways to increase Iranian interaction with the African continent within the parameters of NEPAD. During June 2004, the Iranian Foreign Ministry announced the establishment of an "Africa Headquarters", where Iran's development co-operation programme with Africa will be planned and co-ordinated.

Economic Relations

An important focus of South Africa's relations with Iran is the promotion of trade and investment. South Africa's principal import from Iran is crude oil. In 2002, South African exports to Iran (mostly sugar) were valued at R234 million and its imports from Iran reached R 9.664 billion

Several South African companies are now involved in Iran. SASOL is involved in a joint venture worth US$ 1.6 billion with Iran's National Petroleum company (NPC), while PetroSA is negotiating to become involved in Iran's petrochemical industry. MINTEK and Bateman Engineering are two other companies who appear to be making headway in their fields of expertise. There are other initiatives by Standard Bank, Klein Karoo Livestock Exports, Al Jabber Grinaker, Intelcon and Global Railway Engineering.

Iranian companies are also becoming involved in South Africa. Two are involved in multi-million US Dollar housing projects in the Western Cape. Mahsoud Porcelain, together with the Eastern Cape Development Authority, is to establish a porcelain factory valued at US$100 million, in that province. There are reportedly 68 Iranian companies involved in trade with South Africa.

Syria (Saturday, 28 - Sunday, 29 August 2004)

In Syria, Deputy Minister of Foreign Affairs, Aziz Pahad will meet with the:

• Minister of Foreign Affairs, Farouk Al-Sharaa
• Deputy Minister of Foreign Affairs, Dr Darwish

Full diplomatic relations between the Syrian Arab Republic and the Republic of South Africa were established on 1 June 1994. Syria has maintained an Embassy in South Africa since June 1998 while the South African Ambassador in Cairo is accredited to Syria on a non-residential basis. South African officials are currently in Damascus preparing for the opening of a South African Embassy.

Opportunities for South African Business

Three different sectors - light industry, pharmaceuticals and medical equipment, and tourism - provide added incentive and opportunity for SA businesses. Opportunities for South African businesses lies in the pharmaceuticals and medical equipment sectors. Currently, there are only 45 pharmaceutical companies in Syria, and demand for medicine is rising.

The Government has plans to construct 21 new hospitals that would increase total capacity by 25 percent. These plans would significantly increase demand for pharmaceuticals as well as medical equipment such as x-ray machines, MRI scanners, and ICU equipment. Extensions in Syria's power grid are on the cards as are plans for a mass public transport project. The European Investment Bank and companies from Sweden, the UK, Germany, Switzerland and Ireland are already involved in bidding processes.

There is also a growing demand for light industrial equipment in all sectors, especially in consumer goods. The textile and food processing industries will continue to expand. Additionally, the following sectors have been identified as leading trade opportunities for South African businesses:

• Oil and gas infrastructure
• Electricity generation
• Telecommunications,
• Cotton manufacturing
• Fertiliser and chemical processing
• Grain storage
• Irrigation equipment
• Computers
• Agricultural products (including corn, soybeans, rice, cigarettes, vegetable seeds, and almonds)

Trade relations

The most recent trade figures are very encouraging, with a nearly 75% increase in exports over the past two years. South Africa's exports to Syria for 2002 were R 60.5 million and imports R 6.5 million. In 2000 South Africa's exports were R34 million and imports were R3.9 million, which was an increase of 11% from 1999.

Exports to Syria include agricultural products and petrochemical equipment. Business opportunities have been identified in light industry, pharmaceuticals and medical equipment, such as MRI scanners and ICU equipment. Other sectors include oil and gas infrastructure and beneficiation (e.g. liquefaction of gas), electricity generation, telecommunications, arms sales, computers, irrigation equipment and cotton processing.

The main South African exporting companies are: Murex Biotech SA; Precision Valves SA; Delta Chemicals/Bayer Chemicals' Makro Medical; Nestle SA; Wika Instruments; Plaaskem; Marno International; Hygrotech; ATC; Sasol.

The major goods imported from Syria are textiles, pharmaceuticals and chemicals for medical laboratories; technical equipment; agricultural products (insecticides, fungicides, seeds etc.); coffee, tractor accessories and parts; poultry feeding equipment; chrome tanning salts/computer technology.
Syrian exports on the world market include crude oil, medicines, processed cotton, textiles, carpets and agricultural produce, especially olive oil (no. 5 on the world scale for production) spices and pulses.

Jordan (Monday, 30 August 2004)

In Jordan, Deputy Minister of Foreign Affairs, Aziz Pahad will meet with the:

• Foreign Minister, Dr Marwan Al-Muasher; and
• Secretary-General of Foreign Affairs.

Following a number of top-level visits, diplomatic relations were established between Jordan and South Africa on 28 September 1993. The South African Embassy in Amman was opened in the Forte Grand Hotel by a Chargé d'Affaires (a.i.) in December 1993 and the Jordanian Embassy in Pretoria was opened in June 1994, Ambassador Shaher Bak presenting his credentials to President Mandela the following month. In July 1995, Ambassador De Bruyn presented his credentials to the Crown Prince, the Regent, following his arrival in Amman in April 1995.

Egypt (Tuesday, 31 August - Monday, 1 September 2004)

In Egypt, Deputy Minister of Foreign Affairs, Aziz Pahad will meet with the:

• Secretary-General of the Arab League, Amr Moussa; and
• Foreign Minister, Ahmed El Chait.

Egypt is the most populous Arab State (65.2 million: 2001) and plays a pivotal role in the Arab, Africa and international levels. Egypt focuses increasingly towards ironing out differences amongst the Palestinian oppositions to secure their support in the Road Map initiative.

Egypt also made proposals to strengthen the Arab League (AL) for joint Arab security and greater economic integration. The idea would be for Arabs to solve disputes internally. The proposals include, restructuring the AL along the lines of the European Union, with a Pan Arab Parliament and independent judiciary.

Egypt plays an active role in the OAU and AU. They are members of COMESA, CEN-SAD, holds observer status in the Arab Maghreb Union and have requested membership of SADC. It is a member of the implementation committee of NEPAD and holds the portfolio of agriculture and market access in this body.

South Africa and Egypt cooperate in various multilateral forums especially in the WTO. Egypt is South Africa's third largest trading partner in North Africa, after Algeria and Morocco. Work towards the removal of statutory and non-statutory barriers to trade between our two countries and closer co-operation in fields of agriculture and health are underway. The Egyptians have also proposed a Free Trade Agreement between Egypt and Southern African Custom Union. During the 6th Session of the JBC, held in Pretoria July 2003, a Programme of Action was agreed upon, with the intention of ensuring a forward-looking time bound programme of co-operation. The 7th Session of the JBC will be held in Cairo later this year.

Issued by Ronnie Mamoepa on 082 990 4853
Department of Foreign Affairs
Private Bag X152
Pretoria
0001
22 August 2004