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Funding hinders DTI's global presence

Jan 31 2013 13:22 Sapa

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Cape Town - The trade and industry department (DTI) is seeking funds to increase its global presence, the department said on Thursday.

It currently managed 29 foreign economic offices (FEOs) abroad, the department said in a statement.

Due to limited resources, it was not possible to be represented in every market, but the DTI collaborated closely with the international relations and co-operation department offices to provide support on economic matters where the budget did not allow for full-time DTI representation.

The department was responding to Democratic Alliance MP Wilmot James' recent call for increased staffing in FOEs.

It said the selection of FOEs was made based on the prioritisation of those markets with the largest potential for South Africa, from an investment and export perspective.

Key considerations included regional integration, South Africa's role in Africa, and important economic groupings, such as Brazil-Russia-India-China-SA (Brics).

The DTI had a mandate to service new high growth markets, as well as those traditional markets which had been and still were important business partners to South Africa, albeit at a lower growth rate, such as the United States, Japan, Germany, and the United Kingdom.

South Africa's inclusion into Brics lent an added impetus for focus on countries such as Brazil, India, Russia, and China.

This was due to the untapped potential for collaboration, not just from a bilateral trade and investment flow perspective, but from the perspective of African opportunities.

The DTI said as it now stood, 36% of South Africa's trade was with traditional partners - the European Union and the US - 21% Africa, 22% Brics, and 21% with Asia, excluding China and India.

"As new trading patterns emerge, we cannot ignore the importance of China and India as key markets in Asia exhibiting impressive annual export growth rates."

South Africa's exports to key developing countries of the south in 2011/12 increased by over 5%.

Of the R6.42bn export sales facilitated by the DTI, 47% was from Africa and the Middle East, and 15% from Asia.

In terms of an investment pipeline of potential projects of R40.91bn, an amount of R14.81bn had been recorded, representing 36.2% from developing countries, which included China, India, South Korea, Singapore, and Russia.

Trade and Investment SA (Tisa), a division of the DTI, had strategic relationships and partnerships with counterpart agencies in these countries.

South East Asian countries were recognised as a model for regional co-operation and integration, from which the DTI had learnt much.

"The DTI views South East Asian countries, such as Malaysia, Indonesia, Singapore, and Thailand as integral to our market diversification strategy, and as such there is active engagement with these countries on both export and investment related programmes.

"Various new offices have been identified for economic representation, and the DTI is in the process of securing funding to enlarge its global footprint."

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