Deputy Minister Aziz Pahad to Co-Chair 4th Session of South Africa - Mozambique Joint Permanent Commission for Co-operation, Tshwane, South Africa, 31 October - 1 November 2005

Tshwane - South African Deputy Foreign Minister Aziz Pahad will together with his Mozambican counterpart, Deputy Minister Dr Eduardo Koloma co-chair the 4th session of the South Africa - Mozambique Joint Permanent Commission for Co-operation (JPCC) in Tshwane, South Africa from Monday - Tuesday, 31 October - 1 November 2005.

This visit occurs within the context of South Africa's commitment to consolidate political and economic relations with all countries of the SADC region with the objective of creating the conditions for this sub-regional building block to contribute fully to the implementation of NEPAD's programme for socio-economic upliftment for the continent.

The Joint Permanent Commission for Co-operation (JPCC) regulates bilateral relations between both countries, South Africa and Mozambique have since enjoyed favourable bilateral and multilateral relations.

Utilising the JPCC as an enabling mechanism, more than 25 Agreements, covering various spheres of co-operation, inter alia, Fisheries; the Maputo Harbour; Agricultural development; Natural Gas Trade; Demining; the Maputo Development Corridor; a Joint Water Commission, Promotion and Reciprocal Protection of Investments and Customs Administration, have been entered into.

In addition to the JPCC, bilateral relations between both countries are co-ordinated through the Heads of State Economic Bilateral Forum instituted in 1997. This forum has ensured the successful implementation of a number of strategic projects between the two countries, inter alia, Mozal I and II and the Natural Gas Project.

South Africa and Mozambique share views on a number of issues affecting the SADC region and the African continent including the implementation of NEPAD. Both countries have also shown their united political commitment to work towards the cessation of armed conflicts on the African continent, inter alia through the successful deployment of South African and Mozambican troops in a peacekeeping capacity in Burundi.

Bilateral Economic Relations

Mozambique is South Africa's second largest export market, with trade having increased dramatically over the past three years. South Africa is currently Mozambique's largest foreign investor. Foreign Direct Investment by South Africa in Mozambique exceeds US$ 7 billion.

South Africa and Mozambique's economic relationship is the strongest in the Southern Africa region. Trade between the two countries is on the increase, with 57.2% of Mozambique's imports emanating from South Africa (18% of South Africa's exports to Africa). About 26.2% of Mozambique exports are destined for South Africa.

SOUTH AFRICA - MOZAMBIQUE TRADE

The Industrial Development Corporation (IDC) has been utilised by the Government of South Africa as the primary catalyst for South African investment in Mozambique. To date, the IDC has approved funding for 10 projects geographically spread throughout Mozambique and is currently considering/investigating 6 additional projects in the country. The spread ranges from mining and mineral beneficiation, agriculture, tourism, chemicals, forestry, transport infrastructure to energy.

The Mozal Aluminium Smelter (Mozal 1 and II) remains the IDC's largest investment outside the borders of South Africa. Another major project funded by the IDC is the titanium-bearing mineral sands in southern Mozambique (US$ 600 million). Other major investments of South African origin in Mozambique are:

• Sasol Gas Pipeline Project (US$ 1.4 billion);
• US$50 million investment by SABMiller in beer factories in Maputo and Beira;
• US$63 million by Illovo Sugar in Maragra sugar mill;
• Xinavane (US$ 70 million);
• CDM (US$ 22 million); and
• US$15,5 million investment by McCormack to construct Matola Plaza outside Maputo.

Issued by Ronnie Mamoepa on 082 990 4853

Department of Foreign Affairs
Private Bag X152
Tshwane
0001

30 October 2005