Ambassador Pule Malefane on the cover of Demarche Magazine

December-January 2017-2018

"A Dynamic Society on a Dynamic Continent"

DEMARCHE

http://demarchemagazine.com/category/interview/

INTERVIEW WITH AMBASSADOR PULE ISAAC MALEFANE

By Ferhat Yüksel

What are your priorities as the Ambassador here in Turkey, what are some of the things you want to accomplish during your time here?

Relations between South Africa and Turkey are at a high level and relations have strengthened continuously. However, the challenge we face is increasing trade and investment between the two countries which currently does not reflect the high level of our political relations and economic potential. Creating awareness regarding the opportunities in both countries for business and our countries as tourism destinations for our peoples needs to be focussed on more strenuously.

South Africa and Turkey recently held a successful Joint Economic Commission in South Africa. We look forward to strengthening existing economic relations through this ambitious legal instrument, particularly in the following sectors: infrastructure development, agriculture, mining and energy, jewellery and jewellery processing.

In essence my two top priorities are the increase in bilateral trade between our two countries while we build on people to people relations through mutually beneficial engagements.

How do you evaluate Turkey increasingly being active in the African region especially in the recent years?

Turkey, through its Foreign Policy has come to Africa as a partner who supports, strengthens and works together with African countries on focused developmental projects. In short, this is a partnership which has proven to be beneficial to African countries, particularly where hosting students on Turkish government scholarships are concerned.

Turkey was accepted as an observer country in the African Union, and it hosted a meeting of the heads of state of African countries in Istanbul. The fact that Turkish Airlines has 49 direct flights to capital cities in Africa is an indicator of the rapidly developing relations between Africa and Turkey.  

Great strides have been made in the establishment of legal framework of economic, commercial and cultural relations through establishing new diplomatic missions in African countries, paying mutual visits, having contacts at all levels, creating cooperation mechanisms and signing necessary agreements. Humanitarian aid programs and assistance programs aiming at economic development have also been developed while efforts have been made to promote cultural relations and to increase contributions in the field of education.

In short Turkey’s efforts on the African Continent are significant and much needed.

How would you describe the bilateral relations between the two countries? What are the most promising areas for intensification of bilateral cooperation?

Bilateral relations between our countries are longstanding, having been established in 1993 when Turkey opened its Embassy in Pretoria and South Africa opened its Embassy in Ankara in 1994. Honorary Consulates are also utilised to strengthen our partnership.

In the Sub-Saharan Africa, South Africa is Turkey’s leading trade partner. Turkey’s trade with South Africa, which generates more than 30 percent of the GDP of all Sub-Saharan African countries and has the largest economy in its region, constitutes approximately 40 percent of Turkey’s trade with the Sub-Saharan African countries. Trade volume between South Africa and Turkey is approximately 1,4 billion USD, which does not reflect the potential for trade in two economies which have much to offer each other and are resource rich in various ways.  

Approximately 70 Turkish companies operate in South Africa with an investment value of more than 500 million USD. These investments are mostly in the mining and textile sectors. Moreover, there are many Turkish companies especially in Cape Town and Johannesburg which carry out retail and wholesale, as well as import of textiles, carpets and food products. The number of Turkish citizens resident in RSA is estimated around 3000.

Exchange of people traffic between Turkey and RSA has considerably increased since Turkish Airlines started to fly between İstanbul-Johannesburg-Cape Town on 17 September 2007. Turkish Airlines also started direct flights to Cape Town (in October 2015) and to Durban (in November 2015).

South Africa’s Department of Trade and Industry has identified 40 priority projects which may be of interest to Turkish business. These are in a number of sectors including agriculture, construction, energy, infrastructure and water among others. We would encourage Turkish business to contact us for further information on these projects.

And the current situation of our bilateral economical relations? 

I have already mentioned that bilateral trade between South Africa and Turkey is very low for two large and resource rich countries and does not reflect the potential of our countries. Currently our trade is approximately USD 1.4 billion. South Africa and Turkey should utilise the existing and develop new common interests matching the countries skills and strengths in order to increase trade.

What are the largest trade and investment areas between Turkey and South Africa?

The sectors that provide the best opportunity for Turkish Businessmen in South Africa are the energy sector, particularly renewable energy, automotive component manufacturing, agriculture, tourism and infrastructure and construction.  South Africa is a very diverse economy with many different sectors but we feel that these are the sectors that would suit Turkish businessmen because of the skills and experience that we have seen displayed by the entrepreneurs here.

South Africa and Turkey are two complementary economies. Both countries have progressed in automotive, agriculture, coal, energy, and textile and energy generation. In the energy sector, South Africa is exporting coal to Turkey and other parts of the world.  South Africa is within the first 10 countries in the region considering the solar energy. Wind, biomass and hydroelectric power are among the strongest areas that we are also developing projects and we are working on joint projects with 2 Turkish firms in Biofuels.

Undoubtedly the fastest growing sector is tourism which provides the highest job opportunities for many people. South Africa has actively participated for more than 20 years in the EMITT and has also prioritised Travel Turkey to bring more awareness to the Turkish people regarding South Africa as a tourist destination. South Africa’s heritage sites, for example, should be of interest to Turkish travellers as Turkey itself is renowned for its own cultural history.

We are also actively developing our blue/maritime economy and there are many opportunities in this sector, particularly since Turkey is itself a maritime power.

How do you view the political and economic stability of South Africa as an investment opportunity for Turkish companies? 

It is said ‘business loves stability’. South Africa is a dynamic society in a dynamic continent. Turkish businessmen are well aware and able to adapt to such dynamism, coming with the experience of working in a region which has high political instability. South Africa is not only developing by itself but is also an intricate part of the African continent as well as its involvement in regional blocs such as SADC and COMESA. Africa as it has become apparent is the next growth frontier with countries having GDP rates of 7% and more.  South Africa is the most developed economy in Africa and there are many opportunities for not only Turkish companies, I may add, but companies from other countries as well.

What is South Africa doing in order to attract Foreign Direct Investment (FDI)?

South Africa provides good tax incentives and government assistance to companies investing in South Africa.

There are a number of sectors which provide incentives including in manufacturing, tourism, critical infrastructure, automotive, industrial innovation and others. The South African Embassy has to date signed Memoranda of Understanding with the Chambers of Commerce and Industry of Mersin, Bursa, Antalya, Adana and Izmir to provide a framework for developing our trade and investment relations with Turkey. 

We have noted that the Chambers and industrial zones are very effective in developing economic relations and we will be taking our economic relations forward in this framework through an exchange of business delegations to our respective countries.

What are the sectors in which Turkey and South Africa could cooperate best?

The sectors are renewable energy, construction, agriculture, textile, tourism, automotive, machinery, mining, forestry, furniture, jewellery, and IT. In these sectors we are progressing according to the protocol we have signed a Joint Economic Commission with Turkey. In particular, these sectors offer more opportunities for mutual investment.

Turkey's overall perspective about Africa is mostly based upon exports. But this approach is not helping the development of the African economy.  What is important to us is production. We are urging Turkey "to manufacture" together with us.

South Africa is a country where there are big, medium and small sized firms. Therefore, investments should be made in joint ventures which can benefit both the investor and the small-scale companies in order to strengthen them and thus grow the market for both partners.

How can the Turkey benefit from South Africa? How can South Africa benefit from the Turkey?

Relations should be developed where both countries and their peoples benefit from each other.  With an interdependent and globalised world it is no longer possible for good relations to develop where only the one partner benefits. Mutual trade and investment, a mutual people to people exchange where there is awareness of each other’s countries, cultures and people will greatly enrich and benefit both countries.

Both Turkey and South Africa has a vivid tourism sector. But bilateral tourist numbers and tourism in general between the two countries is weak. Do you think tourism might be a good field to explore by both countries?

It has been proven by the World Tourism Organisation that tourism is one of the greatest multipliers of employment and revenue. We have to focus more strongly on developing this sector. South Africa has a highly regarded and well developed hospitality sector as does Turkey. Closer cooperation between our two airlines will also encourage a movement of people between the countries. Turkey has a large advantage over for example Europe or the US due to the exchange rate and value for money factors for South Africans and Turks alike. This factor should be more prominently highlighted to attract tourists to our respective countries. Furthermore the countries are in opposite seasons so there is no reason why ‘summer holidays should stop’.

South African Tourism recently appointed a manager for Turkey and is planning to conduct tourism roadshows in Istanbul, Izmir and Antalya in the next months. South African Tourism will also participate at the upcoming EMITT in January 2018 to create further awareness of South Africa as a tourism and business destination.

What is the situation of the Turkey-South Africa Bi-National Commission (BNC) agreement? Is there any cooperation taking place through/within the BNC?

The BNC is chaired by our Deputy President and the Turkish Prime Minister. Due to a number of factors, we have not been able to successfully coordinate the schedules of our principles to hold the next BNC. We are hoping that it will be possible in the next year. However the JEC recently took place in South Africa and we will continue our work through this forum for now to promote and facilitate trade and economic cooperation between our countries.

A Free Trade Agreement (FTA) between the two countries was turned down by South Africa back in 2011. Why South Africa did take such action? Also do you believe South Africa will have a different approach to a possible FTA idea in future?

As a member of the Southern African Customs Union, South Africa may not enter into a Free Trade Agreement without the approval of other member states. However, this does not mean that South Africa will not seek alternative ways to cement economic ties with Turkey. South Africa sees Turkey as important partner, for South Africa and the rest of the African continent, and the strengthening of relations is evidenced in the increase in high-level exchanges between our two countries.

What does the South African Embassy in Ankara do in promoting bilateral economic relations between South Africa and Turkey?

As I explained above we have signed Memorandum of Understandings with the Chambers of Commerce and Industry in a number of cities and will use this framework to continue developing relations. We have had a number of business delegations visiting Turkey and having discussions with DEIK and MUSIAD as we have also conducted trade and investment seminars in the cities in cooperation with the Chambers where we have visited. We need to continue doing this as well as to focus on the sectors that show the most potential for growth in trade.

Any final messages to the Turkish business community regarding South Africa?

South Africa is open for business. I kindly invite Turkish business to come and invest in my country. I also urge them to explore many other trade opportunities. South Africa manufactures world class products that would be easily accepted in the Turkish market and provides a unique tourism experience.

The South African Economy is always ready for investment and it would depend on what the investor is looking for. We have a number of investment ready projects in a variety of sectors including renewable energy, automotive manufacturing, jewellery manufacturing, specialised textiles and garments as well as other projects. Other investors may only be looking to buy into companies or own equity and South Africa has a very sophisticated and well managed securities exchange for this investor.

The Embassy can assist any investor with locating the right project if they are uncertain of how they want to invest. If an investor already knows what they wish to do, the Embassy will ensure that the investor is able to engage the correct people in South Africa to ensure his project is a success. This would include meeting the Department of Trade and Industry that will be able to discuss the broad range of investment incentives that are provided as well as establish potential partners, source a location and if necessary assist with the relocation to South Africa.

Any final messages to the South African business community regarding Turkey?

I can say the same thing as I did above, just in reverse. Turkey is open for business too. And I am sure that any help that South African business needs will be provided by the Embassies.