Item 405 - Address by President Nelson Mandela to the National Council of French Employers

TRANSCRIPT

Mr. Chairman;
Ladies and Gentlemen.

To meet business leaders of a nation that is one of the world's principal industrial powers is a great honour indeed. To converse with the motive power behind the largest outside investor in Africa is a humbling experience. When it is also a meeting with proven friends, then the occasion is indeed a pleasure.

I would like to express my sincere thanks to our host Mr. Jean Gandois and the National Council for French Employers for arranging this encounter, and to all of you who have found time from your pressing schedules to be with us.

To say that this is a very timely meeting is to engage in understatement. I am told that trade delegations from France arrive in South Africa at the rate of two a month.

Your government's decision to designate South Africa as one of six priority countries for the promotion of economic relations, testifies to a serious commitment to South Africa's future which we welcome most emphatically.

Thus we are witness to the emergence of a new partnership between France and South Africa: a historic development with the potential to redefine relations between Europe and Africa, between the European Union and the Southern African Development Community.

This meeting is timely also because our government has recently taken an economic policy initiative which boosts the prospects for rapid and sustained growth. As a result, there is good reason to encourage even faster growth in France's engagement in South Africa and Southern Africa.

That is one of our main objectives in this visit to France. And we have ample reason to believe that this objective will be attained. I held discussions for more than one-and-a-half hours with President Chirac on Saturday, and had an hour with Prime Minister Juppe yesterday - and on both counts, we were left in no doubt that a great partnership is in the making between our two nations.

On a previous visit to Paris, some three years ago, I had the opportunity to meet with members of the business fraternity, under very different circumstances.

Today, we are able to speak with the conviction borne of the achievements of two years of democratic government. We are strengthened by the knowledge that French business and the French government have, through their decisions and actions, expressed their confidence in our economic future. In doing so they have also made a concrete contribution to our successes.

For example, we note that over 60 new French companies have established themselves in South Africa since 1991, and that investment decisions already taken will see further growth in this number this year. Trade between our countries in the past two years has grown by 26% a year on average.

Some of the major new investment decisions taken by French companies include the massive new aluminium smelter project in Richard's Bay which I launched a few months ago. They include French companies' involvement in the electrification project in our country.

We hope that we are not being immodest in attributing this confidence, at least in part, to South Africa's achievements since our democratic elections.

The basic soundness of our economic management has been manifest in an average growth rate of three per cent, most marked in the manufacturing industry; and a sharp increase in gross domestic fixed investment. Inflation is at its lowest in two decades. This performance is the fruit of disciplined economic policies based on the efficient and responsible use of public resources; and a climate conducive to the thriving of enterprise.

Our policy of reconciliation has seen a national consensus that is quite remarkable. It has brought us political stability, underpinned by the new culture of human rights and transparent governance that South Africa had never witnessed in its history.

To these factors we would add the great strides made by our region to give concrete expression to the vision of the founders of the Southern African Development Community, as a powerful engine for integrated regional development.

However, our economic growth has not been high enough to create the required number of jobs and produce the resources needed to meet our central objective: namely to deal with the poverty afflicting millions of South Africans.

We therefore set about elaborating a macroeconomic framework with the objective of raising our rate of growth to 6 per cent by the year 2000 - a task that was lent added urgency by the depreciation of our currency.

To meet the key challenges of higher growth and increased job-creation, government's policy of efficient use of public resources is being given additional impetus. The reduction in the deficit is being accelerated.

The strategy pursues growth of exports by promoting competitiveness.

We have taken further steps to relax exchange controls and introduced tax-incentives to promote job-creating investment. As such, French companies and others will have more leeway to acquire funds for investments within South Africa; and those which set up new enterprises will benefit from a range of tax holidays.

Measures relating to labour - including training; labour-market policy; and the relation of wages to productivity - are the subject of discussion between government, labour and business. In these discussions there are no holy cows; and issues such as moderation in wage and salary increases and the reduction of tariffs beyond the imperatives of the World Trade Organisation, have been put on the table for frank deliberation.

We have also taken firm measures to ensure certainty with regard to the value of our currency.

Some of you might have had the opportunity, a few days ago, to exchange views with our Minister of Telecommunications, on a world tour to study the experience of other countries and identify a strategic equity partner for our telecommunications company - a process that we aim to complete by the end of this year.

This is part of our macroeconomic strategy, based on firm decisions to privatise some state assets; to acquire strategic equity partners for others, and to redefine the role of remaining ones. Similar processes are being undertaken with regard to some airlines and the general transport industry, as well as in broadcasting.

The strength of our macroeconomic strategy - like our strategy for dealing with crime - lies as much in the way in which society has mobilised around it, as in the correctness of its prescriptions for our needs. This is one of the dividends of reconciliation, and it is bringing us benefits in all areas of government policy.

We do not underestimate the difficulties and tensions that these complex measures will generate. But we have the resolve and the patience to bring all sectors on board.

We are also pursuing our objectives, in common with other countries with similar needs, in multi-lateral fora. We are committed members of the World Trade Organisation, and of UNCTAD, whose Chair is presently assigned to us in the person of our Trade and Industry Minister present here today.

In that context we believe it is of the utmost importance that every effort should be made to ensure that the least developed countries can benefit from international trade rather than being confined to the margins. This is of particular importance to Africa.

Ladies and gentlemen;

I have only given the barest outlines: to emphasise that South Africa is a thriving multi-party democracy, whose socio-economic policies are based on creating the most favourable conditions for investment and improving the quality of life of all the people, especially those previously marginalised by apartheid.

We believe that this reality sets the scene for a further boost in France's economic relations with South Africa.

The time is ripe for bold initiatives by French investors. Rest assured that, in South Africa, you will find a hard-working people who are ready to infuse their political achievements with consistent economic successes, in pursuit of better life.

We know that, with partners like you, we will succeed.

I thank you.