Western Cape Government rejects spurious allegations on Singapore/Japan trade visit

8 May 2017

An important trade, tourism, and investment mission undertaken by the Western Cape Government has become the subject of petty allegations around travel expenditure.

The Western Cape Government rejects outright all agenda-driven attempts to claim that the amount of R636 000 was excessive to cover all travel, accommodation and related expenditure. This amounted to an average of R127 000 per delegation member, 3 of whom were overseas for 8 days and the other 2 persons for 16 days.

The Western Cape Ministerial Handbook is more stringent than the national handbook. Our officials are absolutely meticulous about working within these guidelines. The planning of the tourism, trade and investment mission was both cost-effective and entirely in line with public finance regulations.

Japanese and Singaporean markets are integral to the success of the province’s Agri-processing and Tourism sectors. Spurred by growth in Asian and other markets, we believe agri-processing and tourism can each add 100 000 jobs by 2019 under a high growth scenario.

If costs cannot be incurred to undertake missions to these Asian markets, then we will be unable to secure the economic return for the province. The track record of our economic strategy speaks for itself.

Under the auspices of Project Khulisa, provincial employment has increased by 40% in the Agriculture and Agri-processing sectors since 2014 through the creation of over 127 400 new jobs. In tourism, early indications are that in excess of 50 000 jobs have been created over the same period.

Growing Tourism, Trade and Investment with Asia

Halal niche markets are one of the priorities of our agri-processing strategy, in which we are growing jobs significantly. Singapore supermarkets dedicated to halal products are very keen on importing more and even acting as a hub to other South-East Asian countries such as Indonesia.

Our data shows that by maximising our reach into the growing global halal market, which is worth in excess of $1.2 trillion, Western Cape Halal industry businesses could create 32 000 jobs. A key part of this strategy is developing the capacity of emerging local entrepreneurs to benefit from this growth. The response from halal traders in Singapore was very positive.

Regarding Japan, the country currently buys little more than wine from the Western Cape and we have only a handful of Japanese investors in the province. This was a key topic in our engagements with Japan’s trade and investment agency – JETRO.

Tourism numbers from Japan are also low, particularly considering the frequency of Japanese travellers abroad.  We need to increase this, and the meeting with leading players from the Japanese tourism industry proved very useful all round.

We also discussed Japanese support for skills development with their agency - JICA. This is in line with our Apprenticeships Game Changer which seeks to add 32 500 new apprentices in key economic sectors by 2019. Already feedback is positive from the Japanese engagement and an announcement will be made when the agreements have been signed.

WESGRO is a world-class Economic Agency

Direct business engagements were facilitated by WESGRO, our world-class economic agency. Their budget for this purpose was R500 000, with the specific aim of opening up economic partnerships between the Western Cape and Asia. This is separate from the cost of travel, accommodation and all other included expenses.

Since the start of this term, WESGRO have secured over R5.9 billion worth of investments for the Western Cape. The agency has also closed a total of 25 trade deals to the value of R8.6 billion since 2014.

It is clear that the money we invest in WESGRO to facilitate trade and investment engagements is well spent, and leads to a major jobs and economic benefit for the province over time.

Cost-Saving Measures

It is worth noting that the Premier’s delegation held engagements in two countries over 8 days. Planning officials were away for 16 days altogether to ensure that high-level trade, investment and tourism negotiations were set up correctly so that outcomes could be achieved. In this context the travel costs are reasonable for a tourism, trade and investment mission of this kind.

Various cost-saving measures were instituted:

- Hotels were recommended by the SA Embassy and High Commissioner in both cases where special rates had previously been negotiated and the proximity
to the SA missions were a priority.

- Business seminars were hosted in the hotels and were cheaper as a result.

- We do not stay in five star hotels, unless they can be booked at four star rates.

Both Japan and Singapore currencies have unfavourable exchange rates with the South African rand. The Singapore Dollar to Rand ratio for instance is SGD1 : 9.4 ZAR. This cannot deter us from building economic partnerships in Asia to the benefit of key job-creating sectors locally.

Issued by Michael Mpofu, Spokesperson for Premier Helen Zille, 8 May 2017