Deputy President Mlambo-Ngcuka to pay Official Visit to Germany

Pretoria - South African Deputy President Phumzile Mlambo-Ngcuka, supported by Deputy Foreign Minister Sue van der Merwe, will pay an official visit to Germany scheduled from Wednesday-Thursday 9-10 May 2007. Deputy President Mlambo-Ngcuka is expected to visit Berlin and Stuttgart while in Germany.

Deputy President Mlambo-Ngcuka's delegation will also include Minister Alec Erwin and Deputy Minister Jabu Moleketi.

Deputy President Mlambo-Ngcuka will visit Germany within the context of South Africa's commitment to consolidate North-South relations with a view to pushing back the frontiers of poverty and underdevelopment through a faster and shared economic growth. Germany is currently the Chair of the European Union and Chair of the Group of 8 (G-8).

South Africa currently ranks 30th as a source country for Germany's imports and 22nd as an export destination. Germany is South Africa's largest import partner and 4th largest export partner after Japan, the United Kingdom and the USA.

In Berlin, Deputy President Mlambo-Ngcuka will be received by Vice Chancellor Franz Muntefering and is expected to pay a courtesy call on President Horst Koehler and Chancellor Angela Merkel.

Issues on the agenda of discussions between Deputy President Mlambo-Ngcuka and Vice Chancellor Muntefering are expected to include, among others:

• The status of bilateral political and economic relations between both countries;
• German support of South Africa's AsgiSA and JIPSA initiatives;
• Co-operation between South Africa and Germany in preparation for the 2010 Soccer World Cup to be hosted by South Africa;
• Developments within the European Union and African Union including greater co-operation for conflict resolution and peacekeeping in Africa; and
• Issues of multilateral concern including the comprehensive reform of the United Nations and South Africa's tenure of the non-permanent seat of the UN Security Council.

In Stuttgart, Deputy President Mlambo-Ngucka is expected to visit the Daimler Chrysler training centre where she will also interact with South African students participating in the Students Experience Programme, the Mercedes Museum and participate in a luncheon with captains of industry. Deputy President Mlambo-Ngcuka will be paying a courtesy call to the Premier of Baden-Wuerttemberg and will be the speaker at the Freedom Day reception hosted by Prof Juergen Schrempp, Honorary Consul-General of South Africa and Chairman of the Southern African Initiative of German Business (SAFRI)

Deputy President Mlambo-Ngcuka is expected to return to South Africa on Friday 11 May 2007.

Bilateral Economic relations

• Germany ranks with the UK and the USA among the three largest economic role players in South Africa regarding trade, investment, finance and tourism. Major investments by German companies include BMW, DaimlerChrysler, Volkswagen, Siemens, Bayer and Ferrostaal.
• Major South African exports to Germany include base metals such as ferro-alloys, primary commodities notably coal, iron ores/metal ash, food products and motor vehicles/parts. Major South African imports include machinery, motor vehicles/parts, electro-technical products, chemicals and pharmaceuticals.
• During the period December 2005 to October 2006, SA exports to Germany increased by nearly 20% whereas in the same period German exports to SA only rose 7%. In this period the largest category of SA exports consisted of finished products (35%), followed by semi-finished products (27%), outperforming SA exports of raw materials (25%).
• The tourism sector has been a major growth area with approximately 250 000 Germans visiting the country annually since 1997, making Germany one of SA's biggest source markets.
• Although SA has been applauded for its open economy, there is concern raised by investors pertaining to the proverbial "red tape" - ranging from procuring work permits, labour laws and BEE requirements. A 2006 survey conducted by the South African-German Chamber of Commerce and Industry regarding BBBEE implementation stated that 45% (last survey: 40%) of the responding companies have introduced a BBBEE policy or plan to while 25% have no such plan at that time. The criteria for black involvement in capital and in management are seen as especially challenging.
• German companies generally support BBBEE in principle - the request for a more user-friendly approach and the need to achieve greater clarity and understanding among potential investors will have been addressed through the recent government gazette publication of the BBBEE codes.

Issued by Ronnie Mamoepa on 082 990 4853

Department of Foreign Affairs
Private Bag X152
Pretoria
0001

7 May 2007