Address at Freedom Day Celebrations, 27 April 2003marks at The World Economic Forum Africa Summit, Durban, 11 June 2003

SESSION: SOUTH AFRICA" REGIONAL BULLY OR BRIDGEHEAD FOR AFRICA'S REGENERATION?"

South Africa has been a key player in the establishment of the African Union as well as its organs, including the Partnership for Africa's Department, (NEPAD). All our activities within Africa are therefore aligned to the NEPAD framework as well as continental development goals in general. We are therefore definitely not the continent's bully but see our role as being to participate actively in the development of the continent socially, economically and politically, in a modest way.

NEPAD

There is no question that governmental and private sector support for NEPAD is strong and enthusiastic. As an economic programme, it has been constructed to address specific African economic problems, and the complex international economic relationships that characterise our global community.

Most African countries are only small elements of the broader global community, which have limited capacity and ability to bargain effectively.

NEPAD sets out an institutional mechanism for Africans to combine their voices and maximise the returns to Africa. We believe we are on the right track.

Despite international economic turmoil, economic growth in Africa is expected to average 3.1% this year and 4.2% next year. This is more than twice the average growth we achieved from 1984 to 1993, and marginally higher than the average for all developing countries.

We also, as collective within SADC, have a vision of what we should do to boost growth, with South Africa as a partner to its neighbours and not a big brother.

We need to enhance intra-regional trade, and to develop our regional economic communities into competitive markets capable of laying the foundation for Africa to compete in global markets.

In order to achieve this objective, we must reform and invigorate SADC, and imbue it with a renewed sense of optimism. Over the past several years, South Africa has been especially vigorous in working with SADC and our Sub-Saharan neighbours to define and implement policies on macroeconomic convergence, investment, and tax harmonisation.

More work needs to be done to raise SADC to meet the expectations of it in NEPAD, but it is fair to say that we are making very significant progress.

We are aware of concerns about a persistent imbalance in trade between South Africa and its SADC partners. South Africa exports roughly six times more to the region than it imports, contributing almost 80 percent of the SADC gross national product (GNP).

In addition, South Africa generates more than 80% of the region's electricity, contains 90% of the railways, 47% of ports, 60% of all tarred road and 90% of telephones.

An asymmetric tariff reduction was proposed during the free trade negotiations to narrow the gap with South Africa. This should boost SADC members' exports to South Africa and encourage regional companies to enter global markets. South Africa aims to reduce tariffs over 5 years; other SADC members over 8 years.

The SADC Trade Protocol, which established the bloc's free trade area, was ratified in September 2000. Its main economic aim is regional integration and development by addressing the problem of small domestic markets, market distortions and the consequent lack of global competitiveness.

It will cover over 85% of regional trade by 2008 and ensure that most intra-SADC movement of goods and services is duty-free by 2012.

Effective implementation will assist SADC countries to increase their exports, stimulate regional economic growth and make them critical global players.

We believe we are engaging our neighbours as equal partners in the development of the region, and believe we all have responsibilities in this regard.

Some of these responsibilities are the following:

Good governance is essential if we are to ensure that our governments, civil societies and private sectors work together to create a better livelihood for the people of our continent.
To this end, the NEPAD Africa Peer Review Mechanism (APRM) is an innovative instrument that will foster the adoption of sound policies, standards and practices through sharing of experiences and reinforcement of successful and best practices.

b. Ensuring peace and stability and playing our role in this regard. South Africa has been involved in conflict resolution initiatives in the continent and within SADC, we are for example actively involved in the DRC. Together with our neighbour Mozambique we are contributing peacekeeping troops to Burundi.

This is all part of our contribution to making the continent stable and to protect human life and restore dignity to the lives of ordinary Africans. This will also assist to create an enabling domestic environment that would be conducive to private sector participation. Capital will only go where it feels safe and where it is able to maximise returns on investment.

We also believe that there should be an unwavering commitment to mobilising resources domestically on the part of African countries. A concerted effort must be made to reverse the declining trends in the levels of savings and investment in the majority of African countries.
In the past, African countries have repeatedly raised the issue of unfair trade practices on the part of developed countries, particularly in the form of tariff and non-tariff barriers. At the launch of the new trade round in Doha, developed countries have undertaken to reduce these tariff and non-tariff barriers.

This will result in greater market access opportunities for African products. The onus rests on us to take advantage of these opportunities by diversifying our economies and reducing supply-side constraints.

I thank you.