South Africa Rising

Ambassador Rasool addresses the crowd at Boston University 17 Feb 2012

This afternoon I attended a presentation by Ambassador Ebrahim Rasool, the South African ambassador to the United States entitled "South Africa Rising." Ambassador. Rasool has visited a couple US universities to promote trade and investment in South Africa and spoke at length about South Africa joining the BRIC group (Brazil, Russia, India, and China) of emerging economic powers and how that can help Africans and investors.  South Africa doesn't compare favorably to the other BRICS countries since it is smaller in terms of population, size of economy, and growth rate but it is the gateway to SubSaharan Africa.  Ambassador Rasool also touted the ease of doing business in South Africa as it has good banks and legal system, as well as manufacturing capacity to use the abundant resources of Africa and the infrastructure (roads, rail, ports, and airports) to move both raw materials and manufactured products.  Another advantage to doing business in South Africa is that there is no debate over state regulation of the markets.  The South African Ambassador said that both the state and private sector have learned to play the violin, or work together to make good music. 

The recent creation of the African free trade area consolidates and opens a huge part of the continent for trade and investment, making South Africa more compatible with the other BRICS.  26 countries from central, eastern, and southern Africa now compose a market of 600 million customers and $1 trillion that can be accessed through South Africa.  Ambassador Rasool stated that South Africa has no special love of China, but they are the ones who want to do business now, and it would be foolish to walk away from them.  The ambassador then encouraged American legislators to expand the African Growth and Opportunity Act (AGOA) and to create more opportunities for trade.  New infrastructure, such as the planned North-South railway into central Africa, would split open the new market that the BRICS and the rest of the world could access through South Africa.

One comment that struck me was that through their years of working with the IMF,  World Bank, and other finance institutions, South Africa and other developing countries were forced to give up subsidies for many of their products in the name of free trade.  However, western powers have not been required to do the same.  For example, the French protect their Champagne and are the only ones allowed to sell their sparkling wine as Champagne (the ambassador said South African champagne was better).

Ambassador Rasool also responded to several questions from the audience on Angola, corruption, South African opinion on action in Libya, and apartheid.  In response to Angola the ambassador first spoke about how Angola has become more stable since the death of Savimbi and UNITA.  Ambassador Rasool then expounded on the importance of having a diversified market not based on just one commodity like oil, because relying on a single source of income creates elites linked to the resource who do not want to give up power.  In response to the question on corruption the ambassador remarked that there are two parties to a bribe and both should be prosecuted, however many of the western bribers are not being held accountable.  The ambassador also explained how South Africa is upset about the UN Security Council Resolution on Libya. The South Africans thought that they were voting to protect civilians, not to provide an Air Force to clear the  way for the rebel advance.  Regarding apartheid, the ambassador mentioned that the younger generation have no idea what it was like to live under apartheid and are now more influenced by Hollywood and want their BMWs and Nikes.  Malema (former ANC Youth Party Leader) spoke about nationalization and redistribution of lands because there was an audience that wants to see that happen.  However, the ambassador stated, South Africa will not do that because the government of South Africa will honor its agreements with its own people, but the whites need to reward the patience of the poor with their generosity. Ambassador Rasool then spoke about the social programs the government provides for all South Africans such as limited amounts of free water and electricity as well as retirement and other social programs in order to benefit the poor.

The reoccurring theme throughout the ambassador's presentation was that Africa has become more stable, democratic, and free and now was the time to reward the progress in Africa with economic investment and development.  Ambassador Rasool repeatedly emphasized that South Africa is the gateway to the huge African market and offered huge returns on investment.  It was a good sales pitch and it will be interesting to see how the new African free trade area develops.