Japan amenable to SA beneficiation

Jun 07 2013 19:07
Cape Town - Japan has shown itself amenable to supporting beneficiation in South Africa and increasing its automotive parts production base here, says Trade and Industry Minister Rob Davies.

Davies said talks at the recent Tokyo international conference on African development in Yokohama, Japan, had confirmed that the Asian nation was increasingly interested in expanding into Africa and using South Africa as a springboard.

A near-completed study on economic co-operation between Japan and South Africa had delivered proposals for projects that would improve skills and competitiveness in the local component production sector, the minister said.

Preliminary findings prepared for the conference included deploying Japanese master trainers to South Africa and establishing a component and supplier park near Toyota's factory in Durban.

The objective was "to incentivise investment towards higher local content" of assembled cars.

Co-operation in the automotive field could also boost beneficiation of steel and aluminium to make car parts.

Japanese fuel-cell technology could further add to local mineral beneficiation, the study suggested.

It also found that there was considerable scope for investments by Japanese companies in agro-processing and increased exports to Japan of fruit, meat, wine and tea, notably organic rooibos.


Davies told reporters in Cape Town that he was surprised to find that Japanese officials did not baulk at South Africa's wish to increase its exports of manufactured goods.

He said the argument for beneficiation had become persuasive, partly because a drop in mineral prices had created a drop in growth rates in Latin American countries to levels as low as South Africa's.

"This is reinforcing the point - many African countries are saying this - that we can no longer expect to prosper simply on the basis of digging dirt out of the ground, putting it on a boat and selling it somewhere and hoping that there is going to be a commodity super-cycle for ever and ever.

"I think that the Japanese are beginning to hear that message because they are massive importers of mineral products as well."

Japan is South Africa's third largest trading partner and has investments of R192bn in the country, which have resulted in some 150 000 local jobs.

South African mineral exports to Japan dominates two-way trade between the two countries.

Davies said he had sent a clear message to Japanese officials that the country would have to start buying "some mineral products from us that are processed to some degree".

He found a willingness to see that "the world is changing in this way".

"There is steadily growing interest by Japanese companies in the African continent... and they also recognise that South Africa is a key player, particularly in the industrialisation of the African continent."

The increased focus from established partners, as well as relative newcomers like China, gave the continent more negotiating clout in trade relations.

Davies conceded that Japanese officials expressed concern about South African labour unrest, but said it had not clouded trade talks.

cape town  |  beneficiation


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