President Thabo Mbeki to pay Working Visit to Saudi Arabia

Pretoria - South African President Thabo Mbeki, supported by Minister of Foreign Affairs Dr Nkosazana Dlamini-Zuma, will lead a high powered government and business delegation on a two day working visit to Saudi Arabia on 13 and 14 March 2007.

President Mbeki will visit Saudi Arabia within the context of South Africa's commitment to strengthening and consolidating relations with countries of the Gulf with a view to increasing the flow of investment from and economic interaction with the region to ensure a shared and faster economic growth in South Africa.

In this regard, a high level business delegation representing 34 companies in the mining, construction and property development, telecommunications and IT, financial services and medical equipment and hospital services sectors including representatives of Coega and Trade and Investment from KwaZulu-Natal form part of the delegation. The government delegation on the other hand includes Ministers Mosia Lekota, Mandisi Mphahlwa, Buyelwa Sonjica and senior government officials.

During this visit, President Mbeki will hold high level political and economic discussions with His Royal Highness King Abdullah bin Abdul Aziz Al-Saud Which will focus among others on:

• The status of bilateral political and economic relations between both countries including the support of the government of Saudi Arabia for the promotion of ASGISA, NEPAD and the African Agenda, including peace-keeping Missions;
• Co-operation between South Africa and Saudi Arabia and the exchange of views on the Middle East, given King Abdullah's mediation initiative between Hamas and Fatah, as well as the situations in Iraq and Iran; and

While in Saudi Arabia, President Mbeki and his delegation are expected to hold discussions with:

• Prince Salman bin Abdulaziz Al-Saud, Governor of Riyadh
• Mr Abdulrahman bin Hamad Al-Attiyeh, Secretary-General of the Gulf Co-operation Council
• Dr Saleh bin Humaid, Chairman of the Consultative Council
• Prince Waleed bin Talal bin Abdul Aziz Al-Saud, Chairman of Kingdom Holdings
• Businessmen to be hosted by Council of Saudi Chambers of Commerce and Industry and the Saudi Arabian General Investment Authority (SAGIA)

Economic Bilateral Relations

Saudi Arabia is the major supplier of crude oil to South Africa. Over the first eleven months of 2006, 34.2% of South Africa's crude oil was imported from the Kingdom. It is also a major investor in South Africa, the biggest recent investment being that of Oger Telecoms (a subsidiary of Saudi Oger), which now owns 60% of shares in 3CTelecommunications, the holding company of Cell C. Several South African companies are involved in major projects in Saudi Arabia (particularly in the mining sector), while the Kingdom is the third largest market (after Israel and the UAE) for South Africa's products in the Middle East.

South Africa's main exports to Saudi Arabia over the first eleven months of 2006 were citrus fruit and iron and steel products, while imports consisted mostly of crude oil, petrochemical products and chemicals. According to figures published by the Department of Trade and Industry, the details are the following:

Year SA Exports SA Imports Total Trade Trade Balance

2001 R1.040bn R14.977bn R16.017bn -R13.398bn
2002 R1.369bn R12.497bn R13.866bn -R11.129bn
2003 R1.256bn R15.050bn R16.306bn -R13.794bn
2004 R1.523bn R17.085bn R18.608bn -R15.563bn
2005 R1.934bn R19.407bn R21.342bn -R17.913bn
Jan-Nov 2006 R1.962bn R21.408bn R23.837bn -R19.913bn

South African companies such as Group 5, Bateman, Foschini, Nando's, Mugg & Bean, Galito and Old Mutual have invested in Saudi Arabia, whereas Saudi businesses such as Saudi Oger (which has invested in Cell C), Amintit, Flowtide, Bin Ladin, Sheikh Zahid, Shabatl, Dallah, Albaraka Bank and Al-Yateen Trading have invested in South Africa.

South African Expatriate Community

It is estimated that there are between 5,000 and 10,000 South African expatriates in the Kingdom, most of whom are employed in the health sector, along with business people and other professionals. Some 20,000 South Africans visit Saudi Arabia every year for hajj or umrah. While South Africa's quota for the hajj is only 2,000, the Government of Saudi Arabia allowed this figure to be increased to 7,500 for the 2005 and 2006 hajj periods.

Tourism

As a result of the increase in flights from the Gulf region to South Africa, as well as enhanced marketing efforts, there has been a steady increase in the number of Saudi visitors to South Africa. While South African carriers do not fly to the Kingdom, Saudia operates two flights a week between Jeddah and Johannesburg. These are augmented during the hajj season. South African Airways has a code-share agreement with Saudi Arabian Airlines.

Issued by Ronnie Mamoepa on 082 990 4853

? Department of Foreign Affairs
Private Bag X152
Pretoria
0001

11 March 2007