Xie Ning: Hello, welcome back to China Economic Net. Today we have the privilege to invite H.E. Mr. Bheki Langa, the ambassador of the Republic of South Africa to China to be with us in the studio. Hello, Mr. Ambassador.

Ambassador: Hello, good to meet you.

Xie Ning: Nice to meet you. Just a couple of days ago at an economic summit, the leaders from three African trading blocs signed on the treaty to create a free trade zone. This zone is including about 26 different African countries with a GDP estimated about $624 billion. So what does this treaty mean to South Africa and what kind role will South Africa play in the process of building the free trade area?

Mr. Bheki Winston Joshua Langa, the ambassador of the Republic of South Africa to China visits China Economic Net recently. [CE Photo]

Ambassador: OK, thank you for inviting us to China Economic Net. It's a pleasure to be here. Indeed, the signing of the free trade area between SADC (Southern African Development Communities), COMESA(Common Market for Eastern and Southern Africa) and East African Community which are respectively representing southern African economic bloc is SADC; and COMESA in the west Africa; and  East African Community in east Africa. Those three trading blocs came together a few days ago and signed a treat in Johannesburg for free trade area which will see the 26 countries who are represented by these three trading blocs and major 3 trading blocs in Africa would see those 26 countries opening a free trade zone for trades, for exchange of goods and services among themselves. And this is a very significant development because as you have indicated these three trade blocs, these 26 countries represent a combined GDP of some $624 billion. So this is quite significant also for Africa's trading partners. It means that we have a very big market opening up for those countries that are trading with any one of those three trading blocs. South Africa is already a permanent member of SADC. So in fact that South Africa has quite good trading links and relations with China. This is also an opportunity for Chinese business. It means a wider market is opening for Chinese entrepreneurs in Africa.

Xie Ning: So can we say that South Africa will play a very important role in the building of these free trade areas?

Ambassador: South Africa is very instrumental in campaigning the idea of a free trade area in bringing those three trading blocs together. So we are going to continue South Africa to play a key role in this.

Xie Ning: Last December, South Africa formally joined the Bric countries, Bric nations; this is an economic cooperative mechanism, by the invitation from the four other nations. Now the Bric nations eventually became BRICS. So I noticed that there is a commentary of South African media, it said that is a milestone marking the South Africa has become a major emerging power in the world. How do you think about this comment?

Ambassador: The accession by the South African to Brics membership is indeed a milestone in the development of the country. It's an indication of the growing status of South Africa in the world matters, and the importance of economic influence in the world, on the African continent in particular, and also because of the important role that South Africa is playing on the international arena on various issues and on global governance, on resolution of problems that to face mankind. So the invitation of South Africa to join Brics was very much based on the recognition of the important role that South Africa is playing not only on the Africa continent, but generally in the world. As you know, where all five members of Brics are also said that we are in United Nations Security Council. 

Xie Ning: I noticed that this spring at the BRICS Summit and Boao Forum, some media interviewed you; you had said that in your opinion the Brics is not yet an economic group because there're obvious discrepancies in the five countries' economic development. But you said there is an advantage side; there is a good side because there is some identical political view among these members of Brics nations. So in your opinion what can we say, what is the political identity among the members of Brics?

Ambassador: The good thing about Brics is that those five countries are located in different continents and they are different countries in terms of social culture that they make up. But what is quite significant is that they are in common positions, all those five countries take as far as the key issues that affect the mankind. There are a lot of common views as far as, for instance, issues of global governance, how we manage international problems, conflicts. How we resolve those conflicts is a very good cooperation among those five countries and those five countries are consistently being voicing these positions, these transparent positions at the United Nations' Non-aligned Movement and in various international forums. So there are a lot of elements of this. And also in the economics fields, the Brics countries have also taken consistent positions in favor of restructuring the international financial architecture to suit and to benefit not only a few powerful countries but to democratize international financial architecture to the benefit of all countries in the world, including particularly developing countries. For instance, we the Brics countries have been cooperating around, and coming up with the ideas about how we can reform international financial institutions, the IMF, the World Bank and so on; to respond much more better to the economic challenges that are facing the mankind.

H.E. Mr. Bheki Langa (R), the Ambassador of the Republic of South Africa to China and the host  Xie Ning (L) , deputy Editor-in-Chief of China Economic Net, pose during an interview in the studio. [CE Photo] 

Xie Ning: That's the identity of this can help, can support this group's existing.

Ambassador: Of course, the other reason for the formation the Brics countries is the exchange of trading and economic relations, promotion of economic and trade and investment relations between those countries, the higher number of programs that have been identified to promote trade to promote joint projects key projects between those five countries. So this going to be a major economic benefit for all those five participating countries, and also we say that South Africa being located on the African continent, its membership of Brics is also going to have a positive impact on the African continent.

Xie Ning: According to the latest figures, that the economic growth in African continent is the fastest in the world, comparing with the rest of the world. In 2010, the overall economic performance of South Africa is also very sounding. However, the growth rate of South Africa was not as high as the other southern African countries in the recent years. So what is the main factor encumber or hurdle the economic growth in your country?

Ambassador: Indeed the economic growth rates have not been as high as we would like, still a lot of challenges, in unacceptable high rate of unemployment. We have got plans to create more jobs, to reduce unemployment, because the strategies that we have put in place to that and we have got strategies to put in place to stimulate various sectors of the economy, particularly low sectors which generate employment. So we are not happy with the level of the growth rate at that moment. But I must say that South Africa has been consistently, since 1994, maintaining positive growth rates. Maybe not as high as old development, but today it has been consistently positive and even during the time of economic crisis, South Africa was able to withstand some of the negative impacts of economic crisis because of its very sound macroeconomic policies and management. Talking about economic growth incidentally the IMF has recently published its prognosis for the future and IMF's predicting that South Africa is going to this year 2011 have a growth rate of some 4%, which is an improvement from the 3.8% of last year 2010. Also for 2012, the economic growth rate as predicted by IMF for South Africa would be even higher at some 4.2%. So it is the IMF has given South Africa a positive economic outlook.

Xie Ning: So it's moving along a positive trend.

Ambassador: Not as high as it would be but it's quite discernable, an upward trend in the performance of the economy.

Xie Ning: last October, the new cabinet of South Africa, the newly formed government put forward an economic strategy called New Growth Path. So could you tell or brief us something about this strategic document?

Ambassador: The New Growth Path was adopted as a strategy by our cabinet early this year. It's intended to stimulate economic growth in South Africa primarily through promoting and stimulating the growth of industries which generate economy and add value to our economy, to our resources. So it's a strong focus on stimulating job creation in fact we have got a target of creating some five million jobs by 2020. That would reduce drastically unemployment to 15% 15% is still high but it would be a great improvement if we can achieve that. The New Grow Path which has been adopted has the essential elements of the industrial development and action plan which has identified a number of key sectors of the economy which would be targeted for development such as the chemical sector, the furniture, plastics and food sectors. Those industries are generating employment and also add value to our resources.

Xie Ning: So it's very significant and I think the employment is a common problem. Also in China, we have the problem, to solve the employment problem. It is similar. When President Jacob Zuma paid a visit to China last August, the state leaders from the two countries signed on the Beijing Declaration and also they announced upgrading the strategic partnership between the two countries. Currently China is the largest trading partner of South Africa, and South Africa is the number one trading partner of China in the African continent. Could you give us a scenario of the development of bilateral trade and economic relations?

Ambassador: Economic relations between China and South Africa have developed at a very rapid rate since the establishment of the diplomatic relations 13 years ago in 1998. And it's quite remarkable that trade has risen from a very low base between the two countries to some $16 billion in 2010 last year. That's a very significant growth of the trade relations between the two countries. And China has got some $7 billion invested in South Africa and one of the largest investments was investment by ICBC which bought some 20% of Standard Bank. But the other Chinese companies which are active in South Africa, Sinosteel, Huawei, ZTE, they are quite a few big Chinese companies and SMEs. So we are quite happy with the rate of economic cooperation between our two countries and it's true that our relations have gone through a number of significant phases, we started from simple partnership and each of us is limited to a strategic partnership. And with signing of Beijing Declaration for establishment of a Comprehensive Strategic Partnership (CSP), the partnership between China and South Africa was raised to a very high level of comprehensive strategic partnership. And on the basis of this, we are sure to see in a number of key projects and programs developing which will deepen economic ties between South Africa and China. And when some of the key agreements that we signed as part of the framework of the comprehensive strategic partnership, while cooperation in the area of energy, in the area of infrastructure development; agriculture, health and transport were some of the areas which are currently explored between our two countries. And China is a giant as far as development in infrastructure is concerned. We are seriously looking at cooperation with China in that regard.

Xie Ning: You just mentioned about the mutual investment between the two countries that by 2010, the non-financial mutual investment of the two countries has accumulated to 1.5 billion US dollars. And also there is a striking event was ICBC paid 5.5 billion US dollars to obtain 20 percent shares of Standard Bank of South Africa. So do you think if there is any potential for the mutual investment in the future? For instance, what kind sector will mostly welcome Chinese investment?

Ambassador: There are a lot of hopeful joint ventures around the investment in the joint projects between Chinese and South African business people. In fact, that's the type of investment that would certainly encourage; that would certainly be beneficial to the two parties when you have a partnership, a joint venture. It's less risk because you share your risk with your partner. So we would like to encourage a type of join venture approach to investment. And ICBC Standard bank project is a very good example of what can be done. And there are a number of, I mentioned Huawei. Huawei has got a joint venture with MTN in South Africa and with other smaller companies in the country. And this is how we should conduct business. I think Chinese investment is very welcomed in South Africa. And we would particularly like to see Chinese investment in those areas: that in those sectors that would generate employment, would lead to skills development, would lead to technology transfer, we would like to see Chinese investment in the higher end of the value chain. And we would like to see Chinese entrepreneurs getting more and more involved in the beneficiation of our very rich mineral resource base through creation of secondary industries around the mining industry; around the agriculture. We would like to see a movement up the value chain to more value added activities and that would generate more employment and a lot of benefit for those companies invested in.

Xie Ning: There is no doubt a lot of progress; a lot of achievements have been made in the mutual investments between the two countries. But as far as the business environment is concerned, we heard that some Chinese companies are complaining about that the social security problem troubled them there. Would you tell us what's the actual security situation in South Africa?

Ambassador: We do consider that from time to time there are problems. But I would say on the whole, South Africa of us has very sound investment climate for investors. The government seriously committed to attracting foreign investments, seriously committed to bringing more and more tourists from all parts of the world including China to South Africa. And we are doing everything as government to create a safe environment for the investors, foreign investors in the country and also for visitor to our country. And I think this was also demonstrated during the World Cup, a lot of people, we were expecting problems when we had thousands of thousands of people coming to our country, but you've witnessed World Cup was very successful. Our government and our people make sure that our visitors were safe and they could enjoy the tournament. Also in the area of investment we are doing everything to ensure that there is protection. South Africa has very sound legal and financial mechanisms to protect the interests of foreign investors and we have also been beefing up the capacity of the police and security apparatus of the country to ensure safety of our citizens and our foreign investors and visitors to our country. So I think the situation is not as bad as it is sometimes depicted. Now and then there could be an incident but generally the climate is very positive, very constructive.

Xie Ning: We believe that there will be more Chinese enterprises to seek the opportunities in South Africa in future.

Ambassador: Yes. In fact that as you know as we speak there are thousands of Chinese citizens who live permanently now in South Africa who have got running business quite successfully. Also we have a concept called Chinese South African or South African Chinese. People of Chinese original live, work and do business in South Africa. So I think they can speak their presence, they can speak louder about what South Africa has offered.

Xie Ning: Talking about the tourism sector, the tourism sector is one of the fastest growing sectors in your country because of the very rich tourism resources and also the perfect facilities for accommodation, accommodating facilities there. And we are very happy to notice that in 2010, the number of Chinese tourists arriving in South Africa is about 54,000 and the meantime there are about 64,000 South Africans visited China. So the bilateral tourism is increasing. Is there any preferential measure, means or treatment to attract just for the Chinese tourists?

Ambassador: Yes, we have a mission in our embassy here; we are working very hard to make it easy for our Chinese friends to visit South Africa. We are committed to speedily process visa applications and it takes not more than 5 days to process a visa. It can actually be less than 5 days but we say it won't be more than 5days. That's the commitment we have given. And we do everything to promote visits by our Chinese friends to South Africa and provide all the information that they would need; how to behave, how to conduct themselves, what to avoid and so on. And South Africa is quite a safe environment. It's important though that people must observe the basic things that visitors everywhere have to observe. Our industry is a hospitality industry that hotels and the government institutions. We have got all kinds of advisory services to help visitors with information so that they can enjoy their visits to the country and the country's got extensive infrastructure which makes easy access to various tourism products that we have. You know South Africa's got quite highly-developed road infrastructure which facilitates transport from one part of the country to another.

Xie Ning: We know that many Chinese people are looking forward to having opportunities to visit your beautiful country. We hope in the future there will be more and more Chinese tourists to be in your country.

Ambassador: Yes, that would certainly most welcome. We attach a lot of importance to tourism industry and we are investing a lot to make it highly competitive.

Xie Ning: Along with the enhanced exchanges in the cultural and humanity areas, in the recent years I think South Africa has become a country having the most sister cities, and having the most Confucius Institutes with China; and also receiving the most Chinese tourists and receiving the most Chinese students in the African continent. South Africa has become such a country. Would you tell us about what kind of activities your embassy organized for promoting the culture exchange?

Ambassador: We attached a lot of importance to cultural exchange. We are in touch with a number of institutions here in China, academic institutions and cultural institutions with a view of exploring opportunities for exchange in the cultural sphere; through foreign science exchange, academic exchange and exchange study opportunities to bring South African students to China. We are actively working on that and also to promote visits or opportunities for Chinese students to study in South Africa. Already there are a lot of Chinese students in our country and we think this is very positive and we're actively promoting that. And we are also looking at promoting exchanges between or links even sister-links between academic institutions, South African and Chinese academic intuitions. And we are happy to have a number of Confucius institutions in South Africa and there is a growing interest in the country in mandarin and in Chinese studies. I think this is a positive development which we are at the embassy actively encouraging. We think economic relations also benefit a lot of from cultural exchange. We want to trade and to do business with people you understand, people you know, and people who are not dangerous to you. So we attached a lot of importance to promoting good people-to-people conduct between South Africa and China.

Xie Ning: Thank you very much Dr. Langa. You're welcome to our studio.

Ambassador: Thank you very much for your invitation.

(This dialogue is transcribed by Li Jingjing and Yang Haiyang, collated by Xie Ning.)