Address by Deputy President Kgalema Motlanthe at the Council on Foreign Relations on the topic: "Enhancing Africa's development through multilateralism and North-South Cooperation", Berlin, Germany
8 May 2012
Programme Director, Professor Eberhard Sandschneider;
Ministers and deputy ministers
Members of the Diplomatic Corps
Ladies and gentlemen.
I wish to start off by thanking you for this opportunity to interact with you on the important topic of ‘Enhancing Africa’s development through multilateralism and north-south cooperation’. South Africa views multilateralism as the necessary intergovernmental response to managing globalisation and the deepening interdependence of national economies. To this extent we remain committed to strengthening the multilateral system and its support for a broader multilateral approach to questions of international peace and security.
Since the onset of democratic dispensation in 1994, South Africa has been working actively towards global political and socio-economic stability and security within the multilateral system. Recognising the need for, and importance of, addressing the pressing social and economic needs of Africa and the rest of the developing world, South Africa looks to the multilateral cooperation to advance the global development agenda and to tackle underdevelopment and the eradication of poverty.
This conviction has spurred Africa’s efforts to enhance multilateral cooperation, drawing on the vision of African renaissance and the New Partnership for African Development (NEPAD), which provides the policy framework for accelerating economic growth cooperation and integration. NEPAD has served as the basis of intensive partnerships between Africa and the developed world on critical initiatives such as democracy, good governance, conflict resolution, post-conflict development and reconstruction, education and health care.
It is widely recognised that the global economy is undergoing major structural change. The past few decades have seen the rise of new sources of global economic growth, of trade and investment flows that are re-defining global economic geography. By 2050, Brazil, Russia, India and China are expected to account for around 47 per cent of total global economy. According to the International Monetary Fund (IMF), these countries will account for 61% of global growth in two years’ time.
Furthermore, emerging-market countries which hold two-thirds of official foreign exchange reserves alongside sovereign wealth funds and other pools of capital will become key players in global financial markets. Much of this rise will likely be due to an expansion of trade and investment especially amongst developing countries.
In order to stabilise the global economic system, it is imperative that we address the gap in economic and general wealth between the industrialised countries of the North and the developing nations of the South. As such we must acknowledge that generally speaking, increased globalisation and economic interdependence, a powerful impetus to liberalisation of trade flows, finance, information and technological change, remains a pre-requisite for strong global growth.
We must however, equally acknowledge that asymmetric relations in both the political and economic global domains are a danger to balanced growth, and that the least developed countries, particularly those in Africa, are unable to benefit from trade. It is therefore in the interest of all countries that a mutually beneficial multilateral trading system continues to develop, and, as has been argued before, there must be recognition of differential impacts on countries ensuring that all benefit, reflecting a true partnership for development.
It is our conviction that multilateral co-operation is more relevant than ever before in seeking equitable solutions to global problems, especially through the UN system, confident that its universal membership and broad mandate occupies the central and indispensable role within the global system of governance. We are however concerned that the developing world, especially Africa, has a limited voice and participation in the decision and policy making processes of the global trade, economic and financial institutions.
This has the effect of weakening the world’s response to the global economic downturn and the developmental agenda for Africa and the South. To address these imbalances, South Africa continues to promote the increased alignment between the developmental agenda of Africa and the South and the agenda of global organisations.
Placing these issues on the agenda, however, rests on the political will of countries to honour their obligations under international law and commitments agreed to in multilateral institutions. South Africa will continue to play a positive and constructive role in Africa’s economic revival and socio-economic development. As we have done since our democratic transition in 1994, we will continue to work with the continent to enhance regional integration, to diversify and strengthen economic capabilities, to build regional markets and to promote cross border infrastructure development.
We will also work with African countries and governments to ensure that economic relations with partners outside the continent serve the developmental priorities as defined by African countries through the New Partnership for Africa’s Development (NEPAD). Our recent inclusion as a member of the Brazil, Russia India China and South Africa group (BRICS) also provides a unique opportunity to advance the interests of Africa in global issues, to deal specifically the reform of global governance, the work of the G20, International trade, development, energy and climate change.
Ladies and gentlemen,
Africa’s relations with countries of the North were traditionally and predominantly premised on Overseas Development Assistance (ODA). Increasingly, however, relations between developed countries and Africa have been strengthened to focus on cooperative partnerships aimed at finding sustainable solutions to Africa’s development challenges.
Although aid continues to represent a significant proportion of development finance in many African countries and remains an important requirement for Africa, focus must shift to long-term endogenous solutions based on building technical competence and stimulating local entrepreneurship. It is important to note that despite increased aid, Africa has not managed to achieve sustainable growth and development. This will only be achieved when the foundations of economic growth and sustained investment are in place and consolidated over the long term. These include, among others, innovation, education, skills development and science and technology. This raises the importance of the investment-export nexus; Africa needs investment that enables it to produce competitive products for export.
Structural changes in the global economy are opening up opportunities to position Africa as a significant player. Development prospects in Africa have brightened on the basis of continent-wide improvements in economic governance, macroeconomic policies, institution building and infrastructural upgrading. The demand for Africa’s natural resources, particularly from emerging economies in the South, offers renewed opportunities for Africa’s developmental prospects.
Growing interest by traditional development partners as well as increased trade and investment from new emerging economies has also given impetus to economic growth and development in Africa. As such, Africa is often referred to as the new investment frontier. The principles guiding cooperation between developed countries and Africa need to be premised on building Africa’s capacities (human, technical and productive, etc.) to enhance and sustain the continent’s development and economic growth.
Global changes have been accompanied by a significant improvement in Africa’s prospects for growth and development. Africa is already the second fastest growing continent of the world, after Asia. There has been significant and sustained growth across the continent, driven in part by the boom in mineral commodities but also by growth in retail, agriculture, transport and telecommunication. Africa’s enormous reserves of raw materials, 60% of unused arable agricultural land globally, a young and growing population, a growing middle class with considerable purchasing power, urbanisation alongside steady improvements in economic governance have been identified as potential drivers of growth which could see Africa becoming the next leading source of global economic growth.
Africa’s full potential for sustainable growth and development demands that we address the challenges of inadequate infrastructure, the limitations imposed by small and fragmented markets, inadequate diversification of industrial output, lack of vertical integration in production, and low levels of intra-African trade, to name but a few.
There is also a need to address market access for African products. The fundamental issue that will unlock sustainable development for Africa is global trade. It is therefore important that we continue to reaffirm that the Doha Development Mandate remains as relevant today as it was ten years ago, and that our fundamental priority is to redress the imbalances and inequities that continue to disadvantage developing countries.
There is, in our view, no way forward other than to move ahead with rebalancing the global trading system in favour of developing countries. This can only be achieved through multilateral processes and engagements.
Closer to home, the entire Southern African Development Community stands to benefit from the recently announced built infrastructure programme in South Africa. Mutually beneficial infrastructure projects, which include strategic investments in water, transport and energy to support competitively priced trade options for the region, are within our sight.
Together with our neighbours and with the support of our private sector partners we will, through the significant capacity which has been developed in our state owned enterprises and the strength of the financial markets in the country, address social and economic infrastructure whilst laying the foundations for the longer term strategic investments in projects such as Grand Inga in the Democratic Republic of the Congo.
The immediate benefits to the region through smarter planning and collaboration lie in carefully balancing a number of aspects to achieve optimal collective socio-economic harmony and strength. Taking into account the lessons learnt from the hosting of the 2010 FIFA World Cup, we have introduced the Presidential Infrastructure Coordinating Commission with the object of prioritising and improving coordination in the delivery of the social and economic infrastructure.
We have carefully projects in energy, transport and logistics that will drive growth and job creation. These choices and options took account of sustainable local manufacturing of materials and products to support the region based on the large number of jobs which will be created. Another focus in South Africa and the region is appreciating our position of strength in supporting global food security by investing in much needed agro-logistics and food manufacturing capabilities.
Our 20-year infrastructure plan will, through its significant investment in much-needed core infrastructure, unlock valuable mineral reserves and deposits in South Africa creating further opportunities for downstream beneficiation and exports.
South Africa’s international relations policy therefore recognises that in order to achieve a better life for all, development and security are best addressed through adequate attention to all global threats facing humanity. In this regard the organs and principal bodies of the United Nations system are of major importance for the maintenance of global peace and stability.
Indeed, if pursued with the seriousness and urgency it deserves, cooperation among all nations will ensure that the new world order is based not merely on the existing economic and political power of the current advanced industrial countries. This needs to be complemented by creative bilateral and multilateral engagement with the developed countries to help ensure that their approach to world affairs benefits humanity as a whole.
The same applies to the challenge of restructuring multilateral institutions, primary among which is the United Nations and its agencies, both to reflect the intention to create a new system of international relations and to regulate the process towards such a system. This is not merely a matter of formality, but it issues from the understanding that these bodies are being called upon to play a greater role in regulating the process of globalisation, and the emergence of a new world order. The leadership role of these organisations must be aimed at strengthening efforts to create a humane and better managed world.
I thank you.
Issued by: The Presidency
8 May 2012
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