The UAE currently stands as one of South Africa's core trading and investment partners. It is the 24th largest investor in South Africa, the 20th most important export market for South Africa and the largest trade partner in the GCC region.
"The 230 plus South African companies based in the UAE bring with them the best of our nation's passion, enthusiasm and skills. South Africans are adventurous people willing to take risks. Hence the UAE appeals to them," says Yacoob Abba Omar, Ambassador of South Africa to the UAE (pictured).
South Africans in the UAE are still on a high following a state visit last November by President Jacob Zuma and five ministers, when three key agreements were signed. The last few months saw visits from the Minister of Energy, who serves on the jury of the Zayed Energy Prize; the Minister of Transport, who spoke at the Ports Conference; as well as Department of Trade and Industry representatives. Omar also hopes to host a business delegation from the UAE to South Africa, led by the Minister of Economy, as well as the first meeting of the Joint Commission.
The UAE is South Africa's 21st-largest export market with the total bilateral trade for 2011 equalling approximately $2 billion (about Dh7.3 billion). Oil is the biggest import from the UAE while fast-moving consumer goods continue to dominate South Africa's exports along with machinery and metal-related products.
With the world waking up to the tremendous investment opportunities in South Africa, Omar hopes to attract UAE investors to his homeland. "The World Bank recently reported that real returns on investment reached high figures before the global meltdown. From 2005 to 2008 it averaged 22 per cent. During the first decade of the 2000s, returns in construction were 85 per cent. This is followed by retail/wholesale trade sector returns which averaged 60 per cent, while the financial sector rose from 8 per cent in the 1990s to 20 per cent, and manufacturing rose from 17 per cent to 25 per cent," he says.
South Africa is the 19th largest investor in the UAE, having invested Dh1.6 billion since 2003. The largest investments were in the financial services sector, followed by the communications and pharmaceutical industries. There are more than 200 South African companies currently operating in the UAE, a few of them being FirstRand, Woolworths, Nando's and Murray & Roberts.
The South African government has taken various steps to enable foreign investment while lowering the costs of doing business in the country. South Africa's Vision 2030 Plan, launched late last year, is on par with Abu Dhabi's Vision 2020 strategic framework. "One sector which is of interest to the UAE is the renewable energy roll out plan. Investment in renewable power [in South Africa] is set to grow from $3.6 billion in 2010 to $57 billion by 2030," says Omar.
With regard to companies operating in South Africa, Aggreko, a leader in the provision of temporary power and temperature control services, opened a massive service centre in Cape Town earlier this month to provide support to shipping and energy, oil and gas industries located at Montague Industrial Park, as well as businesses operating in and around the city's central business district. UAE firms are not far behind with many companies using South Africa as an entry point into Sub-Saharan Africa. One of these is Dubai-based logistics provider Aramex, which bought 100 per cent of Berco Express, one of South Africa's top express courier firms, last December.
On the lighter side
Yacoob Abba Omar moved to the UAE on July 4, 2008. He enjoys the sheer energy and diversity of the region's people and the vast array of cuisines here, joking that his love of Middle Eastern food shows on his figure. Omar, who is currently working on his PhD, loves jazz music, scrabble, and the TV show C.S.I.
His favourite memory of the UAE so far was when the two Presidents met in November last year. "Our two leaders oozed warmth and made many funny comments, especially when the Defence and Joint Commission Agreements were being signed," he says.
— G.K.W.
