Saudi Arabia is a large Arab country and the biggest country in the Arabian Peninsula. It is the world’s leading exporter of petroleum and its phenomenal wealth can be attributed to this natural resource. But this energy superpower is now attempting to develop other resources beyond oil to achieve overall growth.
The Arab Gulf States are keen on fostering closer economic ties with African countries. A recently held Africa Arab Gulf Relationship Conference at the Emirates Center for Strategic Studies and Research, Abu Dhabi, released statistics that the total foreign direct investment by companies and Gulf countries in Sub-Saharan Africa amounted to $15 billion between 2007 and mid-2008. Trade between the UAE and African countries touched $8.4 billion in 2008, though it formed only 3.6% of the total Gulf trade. The UAE’s non-oil exports rose substantially to 30%.
A few days ago the Saudi Arabia-South Africa business Council was launched with the specific purpose of:
- Facilitating an increase in the volume of trade by easing the process of entry of products in each others markets;
- The department of Trade and Industry and the Saudi Arabian General Investment Authority signed an MOU to increase flow of investment between the two countries;
- Initiatives on food security to be undertaken;
- Signing an MOU on science and technology.
Importing agricultural products from South Africa and in return exporting talent to South Africa would enhance food security. This would offer an opportunity to Saudi Arabia to move away from its focus on oil and energy products as its sole exports. Long term investments would be undertaken by this oil rich nation in the field of farming. Saudi farmers had perfected a technique of growing maize in a manner that ensured a higher level of produce per hectare, and would use this technique in Africa. South Africa remains a net importer of foodstuff and needs to reverse the scenario in order to advance economically.
A number of fields have been short listed for bilateral economic cooperation between Saudi Arabia and South Africa. These include construction, chemicals, fishing, agricultural processing, metals and allied industries, boat building, mining and capital equipment, electronics and information technology.
At present, trade between South Africa and Saudi Arabia has crossed the R 3 billion mark, and imports from Saudi Arabia crossed R25 billion. The two countries’ parastatals PetroSA and Saudi Aramco have been working in close cooperation.
Source : China Africa
