The Nigerian High Commission in South Africa has called for an improved regulatory framework and a visa regime to “scale up” trade and other relations between the two countries and their citizens.
Ambassador Alexander Temitope Ajayi, the Acting Nigerian High Commissioner to South Africa, has urged the business community and ordinary people in both countries to collaborate, exchange knowledge and explore mutually beneficial opportunities.
Ambassador Ajayi has insisted that Africa would benefit greatly from stronger economic ties between its two largest economies. Moreover, the Nigerian government would play its part in improving trade relations with South Africa by facilitating visa requirements and improving the regulatory framework.
Ambassador Ajay addressed the Nigerian and South African business community at an executive breakfast meeting organised by the Nigerian Embassy in Pretoria on Monday, August 19. The meeting brought together business leaders and officials from the Nigerian Ministry of Trade and Relations and their counterparts from the South African Department of Trade, Industry and Competition (DTIC).
The acting High Commissioner further raised concerns about the current regulatory framework in both countries, saying it has impeded trade relations, collaborations and a symbiotic partnership between the two nations. He partly blamed the tight regulatory framework for the failure of most Nigerian and South African businesses to thrive in each other’s countries.
At the same time, a few Nigerian nationals who found themselves on the wrong side of the law were being perceived as the total of the Nigerian image. Ambassador Ajay added that this perception downplayed the good that many Nigerians were doing in South Africa and undermined person-to-person relations between the two countries’ nationals.
Ambassador Ajay, the Nigerian High Commission’s Charge d’ Affairs, added that the two African powerhouses should trade in other goods and services beyond oil and gas. He added that South Africa should tap into the Nigerian agriculture and telecommunications industries.
“In terms of seeing progress, I want to see, number one, that we work on the regulatory framework between the two countries; we work on the attitude of people itself in terms of trying to change the narrative in South Africa and the fact that Nigeria goes beyond the activities that are in the press. We have, as you can see, this collection of people here, the Nigerian business de la cream, Nigerian businessmen and women who have been playing their role in the South African economy. We need people-to-people interaction beyond what we have right now,” Ambassador Ajay said.
Moreover, the head of the Nigerian mission urged the business community in South Africa and Nigeria to seize opportunities provided by the two countries’ “comparative advantage”.
“We know they are far apart geographically. But what can Nigeria bring to benefit South Africa? We know we have a lot in the agricultural area because when you look at the food production that people are talking about here, South African food is limited in quantity compared to Nigeria. This is our strength. We need to go beyond mere manufacturing. We need to kickstart processing food products in South Africa. At a government level, on our own side, we would try to facilitate visa requirements and our own regulatory framework in Nigeria,” the Ambassador added.
The DTIC, which regulates trade relations between South Africa and other countries and assists local businesses in navigating regulatory challenges, said it was pleased that Pretoria and Abuja had completed their respective domestic legislative obligations to “commence preferential trade area” between the two nations.
Calvin Phume, the DTIC’s Director for Africa Bilateral Economic Relations, said the move would open up many opportunities for collaboration between different economic spheres.
“If South Africa and Nigeria can work together, we can beat the whole continent on the global stage because we have got all that is required from both countries. We have established both from the two governments that we should work together. We have an MOU on economic cooperation that has been signed between the two countries that want to establish a closer working relationship,” Phume said.
He said the Joint Trade and Investment Committee met yearly to find common ground on the two nations’ challenges. Phume added that a Joint Ministerial Committee on Industry, Trade and Investment had been established to improve working relations.
He urged the Nigerian government to review its communications sector regulatory framework to encourage South African companies such as MTN and MultiChoice to invest in the sector.
“MTN is the number one telecommunications investor in Nigeria. We also see MultiChoice there; they are making a huge difference in that market. So, we must increase cooperation in these sectors in order to make sure that they should be eased from business policies that shouldn’t discourage investment in the Nigerian market. Energy, infrastructure and agriculture: if we strengthen collaboration in these sectors, we can contribute a lot in terms of economic development between the two countries,” he added.
Ambassador Lindiwe Zulu, South Africa’s former Minister of Social Development, attended the business forum to encourage local women to seize business opportunities in Africa. She urged South African and Nigerian nationals to strengthen personal relations, focus on their own economic growth, and build on historical ties between the two nations dating back to the liberation struggle.
“Nigeria supported South Africa through the African National Congress and the Pan Africanist Congress to free South Africa. South Africa is free now, and it is 30 years of democracy. It is time now for us as people of the African continent to focus on our own economic growth and the entire continent. It is time we focus on doing things for our citizens, citizens of our countries, so that we list our people out of poverty, unemployment, and inequality and make life better for Africans,” Zulu stressed.
South African business leaders and their Nigerian counterparts used the opportunity to exchange notes and explore areas of collaboration. Access Bank, a top Nigerian bank that recently entered the South African market, said it sought to “open up trade flows between the two countries” and the entire continent.
Sandile Shabalala, Access Bank South Africa CEO, said opening an office in Johannesburg was part of parent company Access Bank PLC’s Africa-wide expansion plans.
“I think we are now in the 15th country in terms of expansion. It has been quite fast growing into these markets, and solely to ensure we use South Africa as a springboard for trade flows into Africa. So, South Africa plays quite a critical role in terms of opening up opportunities for South African businesses that want to go into Africa, and vice versa,” Shabalala said.
“The opportunities are not just within the African continent. It is actually to follow where trade flows are going. We have now opened offices in China and India. Where is trade going? How do we become relevant for businesses that want to trade not just in Africa but across the continent and globally? Those are the opportunities we want to bring to the South African businesses that want to trade with each other.”
Three years ago, Access Bank PLC entered the South African market after buying Growth Bank, a South African Agricultural Bank, intending to drive trade. Mabel Akinlabi, a South African businesswoman whose company does business in Nigeria, called on locals to broaden their horizons.
She said opportunities were galore in the continent. Akinlabi added that her company, Brown Foods South Africa, had been happily doing business in Nigeria.
Gladys Towobola, a local farmer who was born in Nigeria but grew up in South Africa, said the two countries’ nationals should collaborate to grow their businesses in both markets. She said Peezel Farms, based in Irene outside Pretoria, employed hundreds of people thanks to opportunities seized across the African continent.
Towobola urged local business leaders to attend the upcoming annual Trade Expo in Abuja later this year to “make this talk a reality”.
“It is up to you, and I am here to make it happen. As Africans, not Nigerians or South Africans, we can actually achieve a lot. Local is lekker. Everything on my farm is South African. I don’t import. So, I want a situation where Africans who produce things sell among themselves and make it a reality,” said Towobola, who has lived in South Africa for more than 30 years.
Olorunfemi Adeleke, a Nigerian businessman whose farming and construction company created more than one thousand jobs, complained about travel and regulatory barriers in South Africa and Nigeria, which he said stifled business growth.
The Halifax Group CEO said moving goods and services between Pretoria and Abuja was difficult. The same applied to getting a business visa in South Africa. Adeleke called on the Nigerian and South African governments to do more to ease trade barriers.
“To ship a pig from South Africa to Nigeria is more expensive than flying. Then, you have about twenty different regulatory things that you need to go through to ship the pig. Why is a 10-year American visa cheaper for us to obtain than to obtain a single-entry visa to Nigeria for South Africans?
“And yet you talk about ease of trade; It costs about R6000 to get a single entry visa for South Africans to go to Nigeria, whereas it costs about R2000 to get an American visa for ten years,” Adeleke said.
“The Chinese people in South Africa have been able to negotiate status for them to be Black Economic Empowerment (BEE). We, as Nigerians, don’t qualify for BEE. Those are the things I want the High Commission to start engaging the South African government on to make things easier.”
He said macroeconomics was the reason behind the failure of most Nigerian businesses to compete in South Africa.
“When you look at the South African Stock Exchange, it’s [worth] about one trillion US dollars. When you look at the Nigerian Stock Exchange, it’s about 95 billion. A lot of Nigerian businesses don’t have the resources to compete in South Africa because for you to compete and do business in South Africa takes a lot of money,” Adelele added.
Doris Ikeri-Solarin, the president of the Nigerian Union South Africa, echoed the same sentiments. She said the more than 20,000 members of her union could help boost economic growth in South Africa if regulatory frameworks were eased.
Another Nigerian businessman based in South Africa, Josia Gordon, the CEO of IT company ATG Digital, called on the Nigerian High Commission to support local Nigerian communities and facilitate the movement of capital between the two countries.
