U.S.-SOUTH AFRICA RELATIONS

Map Credit:  U.S. State Department
FROM: U.S. STATE DEPARTMENTThe United States established diplomatic relations with South Africa in 1929, following the United Kingdom's recognition of South Africa's domestic and external autonomy within the British Empire. Until the 1990s, the South African Government followed a policy of white domination over the majority-black population and racial separation (apartheid). From the 1970s through the early 1990s, U.S.-South Africa relations were severely affected by South Africa's racial policies.
Since the abolition of apartheid and 1994 democratic elections, the countries have enjoyed a solid bilateral relationship. South Africa is a strategic partner of the United States, particularly in the areas of security and trade. The two countries share development objectives throughout Africa, and South Africa plays a key economic and political role in the African continent. The United States seeks opportunities for increased U.S.-South African cooperation on regional and international issues. In 2010, the United States and South Africa launched a strategic dialogue aimed at deepening cooperation on the entire range of issues of mutual interest and/or concern.
U.S. Assistance to South AfricaSouth Africa has made remarkable strides toward building a prosperous and peaceful democracy since 1994, but faces many challenges, including unemployment, HIV/AIDS, crime, and corruption. U.S. assistance focuses on improving healthcare, increasing education standards and teacher training, building capacity in agriculture to address regional food security, and developing clean energy to adapt to global climate changes. Improving the capacity of South Africa's security force will enable it to take a lead role in regional stability and security efforts.
U.S. Agency for International Development (USAID) programs seek to strengthen small- and medium-sized enterprises, create employment, improve learning and job skills, promote basic education, combat gender-based violence, and promote HIV/AIDS care, prevention, and treatment. In 2010, Secretary Clinton and South African Prime Minister Maite Nkoana-Mashabane signed a Partnership Framework, creating a five-year plan to tackle HIV/AIDS in South Africa through the President’s Emergency Plan for AIDS Relief (PEPFAR).
Bilateral Economic RelationsU.S.-South African economic and trade relations are strong. South Africa is eligible for preferential trade benefits under the African Growth and Opportunity Act (AGOA). The country belongs to the Southern African Customs Union, which has signed a Trade, Investment, and Development Cooperative Agreement (TIDCA) with the United States. The TIDCA establishes a forum for consultative discussions, cooperative work, and possible agreements on a wide range of trade issues, with a special focus on customs and trade facilitation, technical barriers to trade, sanitary and phytosanitary measures, and trade and investment promotion. The United States and South Africa have a bilateral tax treaty eliminating double taxation. A bilateral trade and investment framework agreement has been signed, and discussions on it were renewed in 2011.
South Africa's Membership in International OrganizationsSouth Africa's principal foreign policy objectives are to promote the economic, political, and cultural regeneration of Africa; to promote the peaceful resolution of conflict in Africa; and to use multilateral bodies to ensure that developing countries' voices are heard on international issues. South Africa and the United States belong to a number of the same international organizations, including the United Nations, International Monetary Fund, World Bank, G-20, and World Trade Organization. South Africa also participates as a key partner in the Organization for Economic Cooperation and Development's Enhanced Engagement program.

SEC. OF STATE CLINTON'S REMARKS IN SOUTH AFRICA

FROM: U.S. STATE DEPARTMENT
Remarks at Meeting With U.S. and South African Business Leaders
Remarks
Hillary Rodham Clinton
Secretary of State
Department of International Relations and Cooperation
Pretoria, South Africa
August 7, 2012
Thank you very much, Deputy Director General, and thanks to the two ministers who together, I think, have laid out a very ambitious and promising framework for this growing relationship on the business, trade, and investment side to continue to do so. I want to thank the Department of International Relations and Cooperation and my friend and colleague, Minister Mashabane, and the Department of Trade and Industry and Minister Davies for hosting today’s meeting. I’m delighted to see so many high-ranking American officials and American representatives of business here today.
I appreciate Minister Davies reminding us what I do believe is the keystone to our relationship, and that is that the United States, in our strategy towards Sub-Saharan Africa, is working to build partnerships that add value rather than extract it. And that means that we want to spur efforts for greater economic growth through increased trade and investment in the region. Now we don’t come at this from some kind of altruistic prospectus. We actually think that this is good for American business. We think a strong, thriving economy in South Africa and in the region is good for the people in those countries, and that helps to build a more prosperous, peaceful region and world. That’s in everyone’s interests.
We think increased trade and investment will help create jobs and strengthen economies, and at the same time, help us to reduce poverty and create stability. It also gives us a chance to undergird our very broad strategic relationship with South Africa by the kind of economic growth that is necessary in any democracy. We believe in democracy, our two countries. We’re committed to it. But we also know democracy has to deliver, and when it doesn’t deliver, that raises questions in people’s minds. The best way to answer those questions is for government and business working together in a public-private partnership to deliver the kind of results that both of our peoples deserve.
I’d like to describe just a few steps that we’re taking to strengthen our relationships and why our ties to South Africa are central to this effort. As you’ve already heard, we share a strong economic relationship to build on. The United States exported more than $7 billion to South Africa in 2011, a 30 percent increase from the previous year. This country is obviously our largest export market and largest recipient of foreign direct investment in Sub-Saharan Africa. At the same time, South African exports to the United States are also increasing by double-digit percentages on a yearly basis. And that 22 billion that represents our two-way trade in 2011 is a 21 percent increase over the prior year.
We’ve heard the number 600 representing the American businesses that have put down roots in this country, but that is growing and we encourage that growth. For instance, Amazon.com recently opened a new customer care center in Cape Town employing 500 people, and Amazon plans to hire 1,000 more by 2013. Or One World Clean Energy, a renewable energy company based in Louisville, Kentucky. One World has built a biorefinery that can simultaneously produce electricity, natural gas, ethanol, and biodiesel from organic material. And this project will employ 250 people in South Africa and also teach us both more about what we need to do to achieve clean, renewable energy. We also know that more American companies are ready to do business here, as the people in this room clearly represent. And as the South African Government works to meet its own infrastructure and energy challenges, there are many new opportunities for trade and investment.
Over the next 20 years, the South African Government aims to double its energy production capacity, more than 40 percent of which they intend to have coming from renewable energy sources. Significant investments will be needed during that time to achieve these kinds of energy goals and also to achieve the goals focused on improving South Africa’s transportation infrastructure.
For our part, the United States Government is taking steps to help American businesses play a role in that effort. A wide range of government stakeholders is helping to strengthen our economic relationship, from USAID to the Trade and Development Agency to the Foreign Commercial Service. And we are working on what I call economic statecraft, trying to bring our entire government together so that it works in a more seamless way to achieve the goals that we have set. That’s why the Export-Import Bank signed a $2 billion declaration of intent with the Industrial Development Corporation of South Africa to provide financing of U.S. clean energy exports to South Africa to support the infrastructure improvement efforts.
Additionally, USAID recently announced $150 million of support for small and medium enterprises. This initiative targets our development assistance where it will do the most good for the South African economy. SMEs represent 50 percent of South African GDP and nearly 60 percent of the workforce, and too often we have a kind of split picture. We work with large corporations, some of whom are represented here, who are able to really have an impact in a market. We support microfinance for very small enterprises, often one/two people. But we don’t pay enough attention to where most of the business comes from, and most of the people are employed in so-called small and medium sized enterprises. And we intend to work with you to try to overcome that.
The U.S. Trade and Development Agency and the South African Department of Transportation are also launching the U.S.-South Africa Aviation Partnership. This effort aims to build South Africa’s aviation workforce and build closer ties between our aviation sectors.
And finally, just last month our Overseas Private Investment Corporation approved $65 million in financing for a new private equity investment fund for South African small businesses. The fund will be managed by one of this country’s most experienced middle market private equity funds managers with strong black economic empowerment credentials.
So we will continue to look for more ways to deepen our economic partnership with South Africa. And I look forward to working with all of you in the future, because I really believe that this kind of effort of meeting and working and networking and building those relationships is really at the core of being able to achieve what both ministers and I have talked about in broad strokes today. Ultimately it’s up to you, the businesses you create, the people you employ, the profits you make that then get plowed back in to creating even more growth and prosperity. And that’s the goal that we all seek.

Thank you. (Applause.)