South Africa must open market to African investors - Spio-Garbrah
The Minister of Trade and Industry, Dr Ekwow Spio-Garbrah, has called on African countries and their companies to put emphasis on inter-country partnerships within Africa in order to deepen trading and investments on the continent.
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He said boosting intra-regional trade and investments would not just happen by rhetorics but by deliberate investment decisions to work closely with the private sector and governments of the continent to harness opportunities and add value to raw materials and natural resources.
Addressing newsmen at the Standard Bank Group’s second inter-Africa trade and business conference in Accra, Dr Spio-Garbrah said South Africa, for instance turned to be a more protected economy, but take a cue from Ghana’s liberalised environment which had welcomed a lot of South African interests and other foreign investors, and open up its market to other investors from Africa.
“I think it is in South Africa’s own interest to open up and allow competition from other parts of the continent, just as we also allow them to compete here in Ghana. They don’t easily license banks, for example. It has about four to three mainstream banks in South Africa, whereas there are 30 in Ghana. So as we have allowed Stanbic to operate here, if a uniBank or Zenith wants to open in South Africa, they will have a hard time,” the minister, Pan Africanist and diplomat said.
The context
Dr Spio-Garbrah said for South Africa’s dwindling growth rate to be reversed, opening up their market should be part of the solution, saying although 30 banks in Ghana may be too many, five major banks in South Africa may also be too narrow.
Ghana is home to many South African companies and products. Besides its national airline, South African Airways, which has been operating in Ghana for about 20 years, it has also received Ghana’s fifth freedom rights to operate direct flights on the lucrative Washington DC route in the United States.
There are also several South African retail and consumer shops that market products from their home country. Some fruits from South Africa, such as grapes and apples, are also sold in the open market in Ghana.
Areas for partnership
Addressing the conference itself, Dr Garbrah outlined a number of areas where Ghana, South Africa and other West African countries could collaborate and trade among themselves, rather than always allowing Europe to dominate the trading relationships.
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For instance, since South Africa, a leading gold producer, refiner and processor, could encourage their companies to partner Ghanaians to add value to gold, rather than exporting the precious metal in its raw form to India and elsewhere.
“I cannot understand why we cannot spend some of our investments processing the gold rather than exporting raw ounces out of the country,” he quizzed.
He suggested for instance that Stanbic Bank, a member of the Standard Bank Group, could work closely with the government to develop policies and programmes aimed at small and medium enterprises (SMEs) which employ more people, to add value to natural resources. Such a move, he said, could revive say the dying gold smith sector, which used to be buoyant in Ghana.
Dr Garbrah said they were looking for investors that could partner the country to develop integrated industries.
Pan African Trade Hub System
Dr Spio-Garbrah also drew the attention of businesses and the private sector in Africa to the Pan African Trade Hub System, a virtual e-Commerce platform with African content to promote inter-regional trade.
He said for the lack of any virtual platform such as eBay and Ali Baba, the Presidents of Ghana and Kenya were promoting the platform to link buyers and sellers of products from Africa.
“There is no real platform like this for Africa. Therefore buying tea from Kenya can end you up buying from an European supplier; buying flowers from East Africa could end a buyer in Africa sourcing from a supplier in Rotterdam. East Africans also buy their chocolates from Europe.
“Therefore, this platform would allow us to see our products more directly. This will reduce transaction cost and make products visible to all and more affordable. This will allow a better interface between suppliers and buyers,” the trade and industry minister explained.
Partner for growth
The Chief Executive Officer of Personal and Business Banking at Standard Bank, Mr Zweli Maniathi, emphasised that the conference was for Africans to begin to do business with itself, saying there was more headroom for trading with each other going forward.
He said to place its footing firmly in Africa, Standard Bank decided to scale back on its businesses in emerging markets Brazil, Argentina, Turkey and Russia, saying “over a period of time, we decided to divert all our businesses in these emerging markets with the purpose of focusing on Africa firmly.”
Mr Maniathi said although the bank continued to have businesses in New York, Beijing and London, they were single-mindedly focused on making sure that “we drive businesses for Africa to ensure that the continent’s connection with the world is facilitated by businesses in those geographies.”
Operating in 20 countries with knowledge of the African markets and economies, the personal and business banking CEO said at Standard Bank “we don’t see ourselves only as a bank, but a partner for growth, driving growth in our home, Africa.”
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