Publications
Partners
Johannesburg – A new agreement between Italy and South Africa aims to strengthen collaboration between the countries, which extends beyond trade.
Gauteng premier David Makhura, who was speaking at the third South Africa-Italy Summit in Johannesburg on Tuesday, explained that Gauteng would sign an agreement with the Romagna-Emalia region to promote cooperation and trade.
One of the reasons the Gauteng government embarked on this partnership is because Italy is the eurozone’s fourth-largest economy. “In 2012 Italy accounted for 8% of South Africa’s exports to the European Union,” he said. By 2013, Italy had become South Africa’s 11th most important trading partner with exports to Italy amounting to R10bn. Imports to South Africa came to R26bn in that year.
In 2015, exports from Gauteng to Italy amounted to R8.1bn. This included products such as iron, steel, vegetables, machinery and mineral products, explained Makhura. In turn, imports from Italy to Gauteng came to R19.1bn; products included vehicles, vessels, chemicals, plastics, rubber and capital machinery.
This collaboration forms part of the Gauteng government’s international relations strategy formed in July 2015. The programme aims to strengthen bilateral political and social relations to make Gauteng a globally competitive economy and to create economic growth and sustainable jobs, he explained.
Between 2006 and 2014, the foreign direct investment flow from Italy to Gauteng was worth more than €157m (R2.42bn). Makhura said that Italy has the "know-how, products and personnel” to help strengthen reindustrialistion initiatives in the region.
Gauteng Premier David Makhura addressing delegates during a press briefing at the South Africa-Italy Summit held in Johannesburg. (Lameez Omarjee)
Paolo Borzatta, senior partner of the group The European House - Ambrosetti in Italy, said that South Africa is an important economy in the southern part of Africa and key for Italy to connect with neighbouring countries.
He added that that the summit was instrumental in bringing together leaders from both regions to get to know each other. “To expand growth you need three things: knowledge, personal feelings and trust,” he said. “You must know a country in order to expand in it. It is not just about knowing the data, but about understanding the subtleties of relations and how they work.”
As an entrepreneur, Borzatta said that he makes decisions based not only on data but also on personal feelings. “I need to understand on a personal level who I am working with.” Finally, he added that trust is key in entering a joint venture.
He highlighted the similarities between the countries, and that Italy could contribute to the growth and development within South Africa.
The agreement is set for five years and there are hopes to extend this. It will focus on promoting economic development and trade, sports and cultural exchange, energy including renewables, agri-food and technologies related to the industrial chain, manufacturing, education and early childhood development, and social capital funding.
Makhura added that Gauteng will implement the Young Entrepreneur Association for the development of township economies. Upon returning from a visit to five regions in Italy last year, Makhura said he learnt that small businesses are the “driving force” behind Italy’s economy.
Read Fin24's top stories trending on Twitter: Fin24’s top stories
