Question-and-answer session following the speech

Rector van Ginkel, United Nations University: Thank you very much, Mr. Mbeki.
I think we all understood well your invitation to join you in the promotion of the "African Renaissance," because it has become clear that no single person nor one single country can ever achieve this aim.
Achieving this is not just the interest of African countries and the African people, but it is in the interest of the whole world. This is an opportunity at the moment, now that this strong force in fact has been unleashed all over the continent and the concept is becoming more and more known and supported around the world.
Well, you are so kind to say that you are prepared to take on questions. You will be supported in answering the questions by some other experts here on stage, so no one in the audience should be afraid to pose even the most difficult questions, because there is a lot of thinking power from Africa in fact assembled here.
Q: Would you give some further details on some of the most important challenges for an African Rennaissance?

Mr. Mbeki: We are saying, for instance, an important element which needs to be addressed with regard to meeting this challenge of African development is the debt problem. The debt problem has to be dealt with.
You know about the highly indebted programme concerning the poor countries and the slowness in the movement with regard to the implementation of that programme. The periods that are required by the multilateral institutions for countries to prove themselves that they would not act in the manner that will result in the measures of new debt … are long. The burden continues to weigh down. You have continuous greater outflows of resources out of Africa as result of this servicing of that debt.
Now I do not know if you want us to go into more detail with regard to this question, but the need to address the matter of the debt burden is important, and we're hoping for instance that this matter will be dealt with again.
When President Clinton was in South Africa, we raised it with him. And he undertook that indeed when the G-8 (group of eight industrialized countries) meets he would seek to raise this question. We are hoping that the same position - well, the same position has been taken by the Prime Minister of Japan.
But as I said earlier, the issue of easier access of African products into the markets of the developed world is important. Again, I don't think we have time to discuss this matter in any particular detail. But you see, for instance, a part of what we think is that when we are dealing with the least-developed countries, I am talking particularly about the World Trade Organization, we might start from the position that the products of the least-developed countries should have duty-free access to all of the economies of the developed world.
So that indeed the possibility for the least-developed countries to trade freely with the developed world then becomes one of the ways by which the least-developed become less least-developed.
The third point we are making is that it is necessary to take whatever measures we can take to encourage larger inflows of foreign capital into Africa. I am sure you would be familiar with the figures about this, that when you compare Africa with other regions of the world, Africa will be at the bottom in terms of the regions of the world that attract foreign capital.
I think in part the problem is the persistence of particular images in people's minds about the negative things about the continent. I think, in part, it is to do with a tendency to look at Africa as one whole. So that if something goes wrong in South Africa, people further afield do not say; "Something has gone wrong in South Africa"; they say, "Something has gone wrong in Africa."
So I am saying that one of the things which I think very important is a better communication of what the African people themselves are doing to change their conditions.
The gentleman just has spoken who has been in Kenya and Uganda and Tanzania, and you can see in those countries the great efforts that people have made to move away from one-party states, to address matters of economic policy, to open up these economies in all sorts of ways.
It may well be that that kind of information is not reaching people sufficiently. I am taking in particular here about people who might be interested to invest in the African continent. That's something that needs to be addressed.
I was saying also that the matter of development assistance needs to be addressed, because it is in itself not necessarily bad. It is true that in the past few years private capital inflows into Africa and other developing countries have superceded significantly official development assistance into these countries.
If it was merely a relative matter, it might not be so bad, but you have had arguments that there was a need to reduce development assistance in an absolute way. We don't think this is correct. And we have said that we don't believe the contrasting of development assistance and trade is a correct approach. So, as I was saying, again we could get into the detail of this, (but) I am not sure that would have the time.
We are saying that "Let's all make common determination that Africa constitutes the principal development challenge in the world."
We had a discussion two and a half months ago with the president of the World Bank to discuss precisely this question. To say that if you look at the expenditures of the World Bank group, of the five regions in the world which the World Bank deals with, in all instances, Africa is at the bottom. Whether you are talking about development finance or you are talking about international finance cooperation, talking about concessional money, talking about trade promotion -- it does not matter what you talk about.
In all the various expenditure items of the World Bank, Africa will be at the bottom.
So we were saying, and he agreed fortunately, that why don't we all agree that if you look at the rates of economic growth and restructuring of economies, integration of the world economy, all of these questions. If you look at that, it is clear that the biggest of the development challenges among these five regions with which World Bank deals is Africa.
But the figures don't reflect this. So it is necessary, having said this is the principal development challenge for reasons that are obvious, that then we try and move not only the multilateral institutions, but I think also countries which have got some capacity to move in a way which responds to a determination which says "Africa is our principal development challenge."
The impact of the process of globalization on the sovereignty of countries is an important factor of today's world. The weaker, the smaller you are, the more decisive that impact of globalization is on this matter of sovereignty.
Decisions are taken by the World Trade Organization which we may not be able to influence about tariffs and about the rates at which they must be reduced and so on. Our decisions are taken out of the hands of individual countries; they become multilateral agreements which are enforceable across the globe.
And we believe that one of the correct responses to that process of globalization is to make sure that the smaller countries of the world therefore have a proper place in the decision-making processes of these institutions which take decisions which have a universal impact. And again one we can go into the detail of that, but these are some of the points that we are raising.

Q: What sort of role is South Africa ready to play for the development of the entire continent of sub-Saharan Africa?

Mr. Mbeki: One of the things that is happening with regard to countries of southern Africa that have been mentioned is that you have had some noticeable movement of capital from South Africa into some of the economies in the region.
For instance you might have seen this in Uganda, that part of the process of the development of the telecommunication infrastructure there is partly as a result of new investment that has been put into that sector by South African companies, as does indeed another telecommunication license I think that is coming in Uganda on which, again, South African companies are bidding.
You would also have seen these things in Tanzania, of an involvement by South African corporations in the privatization processes of Tanzania and in some interesting areas that have already had an impact in terms of improvement of quality, growth of exports in Tanzania, and recovery of production facilities that have collapsed.
You would also see in Tanzania a number of South African mining companies that have come into mining in Tanzania to create new capacities and to expand existing capacity. Or, I do not know which airline you might have used while you were in the region. If you used Alliance Airline, it is a consortium of South African Airways and other airways in the region of East Africa.
So I am saying that you have that whole process of investment from South Africa in the economies of the region, and that would include tourism, so I think that's part of what will happen.
And as I was saying, as the southern African development community we've taken the decision to constitute ourselves into a free-trade area and we are involved in discussions about this. And it would seem to us that one of the things that we need to do, as South Africa, is to perhaps move ahead of the rest of the countries of the region because of the relative strength of South African economy to speed up the process of arriving at that free trade area so that we lower tariffs into the South African economy faster than everybody else. So that indeed countries like Tanzania, which are part of the development community, can then gain that easier and better access into what is after all a larger market.
So there are a whole variety of matters like this which point to, I think, a fairly rapid process of regional economic integration taking place.

Q: As immediate post-independence leaders in Africa are now beginning gradually to leave the stage -- the generation that a Nigerian Nobel laureate often referred to as a "wasted generation" -- and your new generation of African leaders are beginning to move center stage in African affairs, can we say for sure that the problem of leadership that has held down African so long is about to come to an end?

Mbeki: I think, personally, that the matter is not really so much a matter of leaders as a matter of the peoples of our continent. I think that the experience that we've had as Africans, which has meant, as I was saying, military coups, one-party states, meant corruption and so on -- I think (this) has taught the masses of our people … that some things are no longer permissible.
I think we have the fortunate situation in which we live in the post-Cold War world. And you know the instances on the African continent when people (who) were bad for Africa were maintained in power by various powers because they were useful in the context of that Cold War contest.
I think there are better possibilities now to ensure that we don't have the images of some of the kind of leaders we had in the past, who progressed from being a master sergeant in charge of a platoon and ended up proclaiming themselves emperors. I think that time has passed.

Q: There is a requirement, where you have this scheme, that employment of a certain percentage point go to women and to minorities in South Africa. Do you think the competitiveness of corporations would go hand-in-hand with this?

Mbeki: No, there is no legislation in South Africa which requires that companies must meet particular quotas. It doesn't exist. What we've done is to say that there are some basic challenges in South African society, such as what I was trying to indicate in what I said earlier.
One of these challenges, and it is a very important challenge, is the creation of a nonracial society. You know what apartheid means. You know what legacy it has left.
Fact of the matter is that if you look at South Africa today, four years after liberation, in terms of the socioeconomic setting of South Africa, it's still essentially an apartheid setting. So racism, we believe it is fundamentally important that that matter be addressed. We also believe, again as I was trying to indicate earlier, that the matter of gender equality, the emancipation of women, is very important if we are going to say this is a genuinely democratic society. But the matter needs to be addressed in a very consistent way.
We have a significant proportion of the South African population who are disabled, who I suppose as in many other countries would in the past have been dealt with as welfare cases. But clearly, our orientation, certainly as far as government and the disabled themselves are concerned, is that they don't want to be dealt with as welfare cases, but they want to be treated as normal human beings. And then things need to be done to ensure that despite their disability they are able to participate as fully as they can in the activities that any other human being would be involved in. And therefore, we are discussing draft legislation which says, these matters need to be addressed: racial discrimination, gender discrimination, discrimination against the disabled.
There's nothing in the legislation which speaks about quotas, which prescribes numbers. Rather, the legislation says that the enterprises, economic institutions, business institutions should themselves work out their own plans as to what they will do to address these issues. So there is no legislative compulsion; therefore, what you might have been told about "You are therefore obliged to take a person who happens to be black, or a woman, or disabled, despite the fact that they are incompetent" - there is no such legislation, and there would not be such legislation either.
But I must make the point that in our society, it is not possible to leave the matter of the racial disparities, the racial differences, to leave those matters unaddressed.
Because if you did, you would indeed be asking for a very big explosion in that society tomorrow, because the majority of this population which continues to suffer from that apartheid legacy surely will not say, "It was enough for us to be able to get the vote, but it is perfectly all right to continue with a society which continues to discriminate" against them in other ways.
I must say that in reality, many of the foreign investors who have come into the South African economy have been very conscious of these particular matters. I know, for instance, of corporations that didn't require any persuading, did not require any legislation - as soon as they took decisions that they wanted to invest in the South African economy and so on, who actually went out of their way to ensure that they themselves recruited and trained people from among black society, so that they could bring them into positions of management and so on. Because they did not want to reproduce within their companies the South Africa of old, where you would walk into a South African boardroom and you would not think you were in Africa, you would think you are in Europe.
So I'm saying there are companies that have decided on their own, without any persuasion from anybody, to address this matter because they understood the challenge of the creation of this nonracial society themselves, and the importance to themselves as corporate citizens, in terms of ensuring stability in the country.

Q: What are the preferable sectors in South Africa in which people might be interested to investing?

(Mr. Moss Ngoasheng, economic advisor to Mr. Mbeki): The question really will take us the whole afternoon if we're going to deal with it in detail. But I mean just to make a few general points on this matter:
One: The reintegration of the South African economy into the world economy itself offers a whole range of opportunities in terms of modernization. So you are required to do quite a bit of work in terms of identifying those sectors. That's a general point.
And I think that one of the great opportunities that we have in the country is to grow and develop the infrastructure within the country, to service the broad range of requirements and needs that we have in the various areas of our people.
So infrastructure development in its general form is an area for investment: water, electrification, housing, municipal infrastructure and so on. That's an area where as a government we are quite active, the Development Bank of Southern Africa, which is the development arm of the state, is a very active player. We have the (Bank's) C.O. here; if you have some interest in that regard, you can speak to him. They're piloting a lot of public-private sector partnerships in that area.
We recognize that mining remains the main sector in the South African economy, and therefore mineral processing and mineral beneficiation is an area where we are seeking greater involvement, and in fact, we are happy that there is a lot of interest from Japanese corporations in that area.
The other area which we think offers a lot of opportunities in South Africa is the area of furniture manufacturing and processing of the forest resources that we have.
The general electronics and IT sector is a very fast-growing sector in the South African economy that I think offers again a whole range of possibilities, and we are quite happy to see that a lot of Japanese corporations are back in the economy and making a lot of products from South Africa.
We have a substantial auto component and auto-producing sector, and we probably are one of the largest, fastest-growing after-market producers of components that go into various international markets. We were in Brazil last year and we were surprised to find that some of the auto manufacturers in Brazil actually order all their seats and other components from Port Elizabeth in South Africa. They produce the car in Brazil but the seats are produced in South Africa…
So there are a number of areas that we can talk about for the rest of the afternoon, but I think those are just the highlights.
The reality of the matter is that the South African economy is bubbling, and there is a whole range of opportunities, and at a distance sometimes you are unlikely to see those. So we invite you to come down and look at those opportunities: the Development Bank of Southern Africa, the Industrial Development Corporation, the Ministry of Trade and Industry, the Investment in South Africa organizations will be able to assist all investors interested in coming down.

Q:Do you have an explanation for this kind of extraordinary response by the leaders and people of South Africa to their long years of oppression?

Mbeki:And so to the last question. I think that the people of South Africa recognize the fact that all of them are South African. I think that is a matter that is fundamental to the willingness and the capacity to accommodate one another. South Africa belongs to all who live in it. I'm saying that I believe, that indeed all of us believe, that South Africa belongs to all of us.
And secondly, I think that the manner in which the country developed historically produced a mutual dependence among South Africans regardless of colour, which the system of apartheid tried to undermine, but couldn't succeed. And therefore I think that there's a recognition that "If I want to succeed, I can only achieve that success with the assistance of my neighbour."
That mutual dependence, which developed as a history of the evolution of our country, makes the South Africans know that it is better that they cooperate among themselves in order to achieve success rather than they fight against one another.
I think also that in the course of the struggle to end apartheid, we arrived at a point where the apartheid regime saw that it could not really defeat the liberation movement, and we ourselves in the liberation movement would not give up, but it might very well take us a bit of time to get to the result of ending the system of apartheid. Therefore, by the time we entered into negotiations, both sides knew that they had not defeated each other, and that both of them were capable of a lot of destruction, and that in the end if you had a lot of destruction, as I was saying, both (sides) will lose something. So in a situation like that, I think it became obvious to everybody that the only way out was not to seek victory one over the other, but rather to find a settlement that would be acceptable to both.
One other thing that happened was that we did in fact spend very many years talking among ourselves as South Africans about the future of South Africa. Many people think that the process of negotiations began in 1990. In fact the process of negotiations to bring about change began five or six years earlier.
And that had to do with a lot of interaction among people who were in the leadership of the society, in various points of leadership in the society: in business, academic world, the religious leadership, sporting people, all sorts of people, the regime itself.
And that particular process was in reality focused on seeing whether we could together elaborate a common vision about the kind of South Africa we want. So as I say, for five or six years we were talking among ourselves to say, "When we say we want a democratic society, what are we talking about? When we talk about an economy that addresses the interests of all the people rather than a small minority that is white, what are we talking about?" All of these questions… And indeed, by the time the formal negotiations started, the formal open negotiations started with the government in 1990, they had developed a common vision about what kind of South Africa we wanted. As a consequence of which, one of the things that we agreed was that we need to put into the constitution a set of constitutional principles which would be agreed by everybody, so that all of the various political formations in the country would participate in the process of drawing up and agreeing (on) those constitutional principles.
So that those principles then became the framework within which the new constitution could be drawn by an elected board. The advantage of that was that even the smallest political player in South African society could make an input into drafting that framework of constitutional principles, so that even if they didn't get elected in the elections that then took place afterward, they didn't feel threatened, because they knew that the new constitution that would be drafted would be drafted in the context of these constitutional principles, which really constituted a consensus about which direction South Africa should go.
And I'm saying that's a consensus which many people worked at, from five or six years before 1990. And I think it's a total of these two issues, the totality of these things, which in the end I think continue to say to South Africans, "There is no benefit to be gained from any policies which seek to discriminate against another South African."
There is no benefit to be gained by anybody in the pursuit of policies that might seek revenge for things that were done in the past. Because in the end, if you took that route, what you would in fact be saying is that we must reopen the conflict. And as I was saying, in the end as South Africans we came to the conclusion that the continuation of our conflict would benefit nobody.
Thank you.

Reference:

http://www.unu.edu/unupress/mbeki.html