Deputy President Paul Mashatile: Launch of Corporate Social Responsibilities Report of Chinese-Funded Enterprises in SA

Programme Director;
Ambassador Wu Peng;
Chairman of SACETA, Mr Zhang Chaoyang;
CEO of Samancor, Mr Desmond McManus;
SACETA beneficiaries present;
Senior Government officials present;
Ladies and gentlemen,

Good morning, Nǐ hǎo!

It is an honour to be invited to this launch ceremony of the Corporate Social Responsibilities Report of SACETA. This event embodies the strong and enduring partnership between our two nations.

The Republic of South Africa (RSA) and the People’s Republic of China (PRC) share a strong and longstanding relationship.

Throughout the years, the bonds between our two nations have deepened, revealing the potential for collaboration with a mutual goal of promoting inclusive and equitable growth.

This was evident when our bilateral relations were elevated to a Comprehensive Strategic Partnership in 2010, marking a "golden era" of cooperation.

In November 2023, I conducted a bilateral visit to the People’s Republic of China. The visit aimed to explore a variety of opportunities to strengthen areas of cooperation and fortify our enduring economic, trade, and interpersonal connections.

My visit included co-chairing the 8th BNC, which focused on practical collaboration on international relations, economic cooperation, minerals, energy, education, science & technology, and the oceans economy.

One of the outcomes of the 8th BNC was to review the current framework of the Sectorial Committees to include more departments. We have also identified critical areas of cooperation for the next two years.

As Chinese-funded enterprises in South Africa, we encourage you to increase your investments in important sectors of the economy, particularly the automotive industry and infrastructure development.

Moreover, the 8th BNC underscored the urgent need to address the structure of the bilateral trade relationship and promoted broad market access for more value-added South African goods in China.

Ladies and gentlemen,

Let me also point out that in September this year, President Cyril Ramaphosa made his second State Visit to China, during which he upgraded relations to an All-Round Cooperative Strategic Partnership for the new era.

It is commendable that during the second State Visit, the two Heads of State reached several important common understandings, among others including that:

● China firmly supports national unity and the path of economic and social development that South Africa has chosen.

● The two countries have agreed to enhance cooperation and synergy between the Belt and Road Initiative, the Economic Reconstruction and Recovery Plan and the implementation of the 10-year Strategic Program of Cooperation (2020-2029) to address priority political and socio-economic issues.

● Both sides committed to providing a stable, fair, and enabling business environment for companies.

● Furthermore, both sides agreed to continue strengthening coordination and collaboration under the BRICS mechanism and work towards more practical outcomes of cooperation within the expanded BRICS framework.

All these visits and engagements demonstrate our dedication and respect for our unique and ever-expanding friendship as we collaborate to establish a high-quality China-South Africa community with a shared future.

Ladies and gentlemen,

As a country, we remain committed to collaborating with regional and global partners to promote solidarity and increase trade relations.

We believe that such collaboration is important for poverty eradication, inequality elimination, and fighting unemployment.

Therefore, today as we gather to launch the Corporate Social Responsibilities (CSR) Report by SACETA, we celebrate not just the economic cooperation between our countries, but also our shared commitment to sustainable development and corporate governance.

In this regard, we acknowledge SACETA members' substantial contributions to South Africa's economic and social development. Your participation and investment in our country are critical for creating jobs and promoting economic growth and development.

The report launching today highlights the contributions of Chinese-funded enterprises in South Africa to environmental conservation, community development, education, and healthcare. It acknowledges the importance of responsible business practices and their positive impact on society, highlighting their dedication to social responsibility and efforts toward a more inclusive and sustainable future.

The 200 Chinese-funded enterprises in South Africa serve as role models for businesses, demonstrating that profitability should be balanced with social good. As the global economy faces challenges like climate change and social inequality, businesses must embrace their role as agents of positive change. The Corporate Social Responsibilities Report exemplifies this ethos, inspiring a prosperous, equitable, and sustainable future.

Ladies and gentlemen,

As the global landscape continues to evolve rapidly, it is essential for nations to cultivate strong partnerships to thrive and navigate the challenges of the modern world.

We should leverage our expertise to navigate towards a more sustainable path, guided by the principles of joint pursuit and a shared future. Our countries have complementary strengths and resources, making us ideal economic partners.

China, as one of the world's greatest economies, provides an enormous market for South African goods and services. In return, South Africa provides rich resources, such as minerals, agricultural products, and skilled labour, to support China's rising economy.

Improving trade connections between South Africa and China benefits both countries directly and has a positive ripple effect throughout the region. Increased trade creates jobs, stimulates economic growth, and improves living standards for the people of both countries.

However, our trade structure is imbalanced. Last year, the value of China's imports far exceeded its exports. Total bilateral trade increased from R614 billion in 2022 to R692 billion in 2023, while China's R146 billion deficits remained the highest among any of the country's trading partners.

We intend to work with China in addressing the trade deficit and structure of bilateral trade by broadening its export basket, especially to export more value-added products.

South Africa mostly exports minerals and agricultural products to China while importing mostly manufactured goods from China. At a time when African economies are becoming more integrated, China's technological prowess may help Africa industrialise and export more than just raw materials. Instead of exporting raw agricultural items, South Africa may export processed foods that are more valuable.

We further agreed that we must meet China's specific market access requirements, such as full compliance with the General Administration of China's (GACC) regulations and standards.

However, China can assist by streamlining import procedures and lowering regulatory hurdles; China may become a larger market for our products, benefiting both South African producers and Chinese customers.

As Chinese-funded enterprises operating in South Africa, you must seize opportunities in emerging fields such as artificial intelligence, the digital economy, and green energy.

Similarly, South African companies can leverage Chinese capital and expertise to expand their operations globally and tap into new markets.

South Africa and China can thrive in an interconnected world by forming strong partnerships, overcoming economic uncertainties, and leveraging globalisation's benefits.

Maintaining this relationship, building trust, and looking for new opportunities for collaboration are vital for both nations. We believe SACETA's initiatives will continue to foster this partnership by looking at fresh investment opportunities.

In 2023, Chinese businesses revealed plans to invest up to 15 billion rand at South Africa's fifth Investment Conference. In that same year, we witnessed the signing of significant purchase agreements totalling 2.2 billion US dollars with companies in both nations. Therefore, our positive trade relations continue to be crucial in combating unemployment, inequality, and poverty.

Ladies and gentlemen,

To promote the interests of the developing countries and change global governance institutions, we must also keep up our close collaboration and mutual consultation on global issues within the frameworks of the United Nations, G20, BRICS, and Forum on China-Africa Cooperation (FOCAC).

Recently, President Ramaphosa participated in the 2024 FOCAC Summit in Beijing, where South Africa placed high priority on promoting the implementation of Agenda 2063. Agenda 2063 is Africa's blueprint for socio-economic development and its flagship projects to redress the post-1994 legacy of unemployment, poverty, and underdevelopment.

We agreed at the summit that increased coordination between the FOCAC Declaration and Action Plans, the recently adopted Second Ten-Year Implementation Plan, and the strategic intervention areas of Agenda 2063 is essential for Sino-African cooperation in expanding the continent's collective economy.

As we take over the G20 Presidency, I must state that South Africa is prepared to host the G20 summit in 2025.

We will work to advance long-term solutions to high structural deficits and liquidity issues, as well as to provide debt relief to developing economies. We will take advantage of this opportunity to put the African continent's and the Global South's development priorities to the forefront of the G20 agenda.

Ladies and gentlemen,

We can all agree that our partnership should go beyond our two countries. The African Continental Free Trade Area (AfCFTA), which provides access to a market of more than 1.3 billion people, provides an even stronger incentive for China and other countries to invest in Africa's manufacturing capabilities and infrastructure.

China, which has achieved tremendous success in infrastructure development, is an important partner for Africa in its aspirations to achieve economic integration and global connection.

South Africa, as a gateway to Africa's market, is committed to fostering high-quality development by creating an economic environment that facilitates economic opportunities, prioritises redistribution and industrialisation, and attracts foreign direct investment (FDI) opportunities.

In 2023, the total stock of FDI from China in South Africa amounted to about 5.84 billion U.S. dollars. This was a decrease from 5.74 billion U.S. dollars in the previous year.

We call for China's sustained and new FDI to support assembly, manufacturing, infrastructure development, and beneficiation at the raw material source.

We need to see increased FDI to create new jobs, expand businesses, and increase production, all of which contribute to the growth of the country's economy.

Considering that South Africa is grappling with significant skills shortages across several crucial sectors, particularly in IT, engineering, healthcare, and finance. I would like to encourage SACETA to also focus on this area.

As a country, we have implemented measures to make it easier for foreigners to apply for and acquire work permits. According to Reserve Bank data, each vital talent brought into the country has the potential to indirectly create seven more jobs.

As a country, we wish to collaborate with you to address these important skill shortages through attracting foreign talent.

We are certain that by partnering with you in this area, South Africa will be able to preserve its long-term growth trajectory, employing people capable of meeting current demands while also adapting to future challenges.

As we move forward, let us reaffirm our commitment to expanding South African-Chinese trade and investment cooperation. Together, we can build a more successful and sustainable future for our countries.

I thank you.