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Thursday, 05 August 2010 12:40

Russia Will Have Eye on China for Zuma Visit

By Loyiso Langeni

JOHANNESBURG, South Africa, August 5, 2010 (Business Day) — President Jacob Zuma will this week lead a high-powered government and business delegation to Russia to narrow the trade deficit with one of the most populous nations in the world.

 

Figures from the Department of Trade and Industry indicate that SA's imports from the Russian Federation more than doubled last year: SA imported goods to the value of R3,6bn, while its exports generated R1,5bn.

 

With an estimated population of 140-million people, Russia is the 12th-largest economy in the world, according to SA's Department of International Relations and Co- operation.

Russia, in hosting SA, is on a quest to regain lost ground as an influential player on the continent. Its influence has waned significantly since the collapse of the Soviet Union almost two decades ago.

 

During those days, most exiled African leaders who belonged to liberation movements - including the African National Congress - received their tuition, including grounding in economic policy, in the Soviet Union.

 

The collapse of the Soviet Union not only reduced Russia's influence in Africa politically but also saw its communist economic principles discarded. Russia is now a democracy pursuing a free market economic system, the very system it detested so passionately during its days as the Soviet Union.

 

World politics have shifted and the new economic blocs have their sights on commodities in Africa.

 

Th e courtship with SA is also a Russian attempt to stay ahead of China, which has usurped the influence that Europe and the US used to command in Africa.

 

According to the Russian embassy in Pretoria, SA's exports to Russia are mainly within the agricultural industry while imports are more diversified. SA exports agri-products, beverages, fruit and prepared foodstuffs, while Russian imports include base metals, chemical products, machinery, mechanical appliances and vehicles.

 

The high-profile delegation is made up of 75 officials from 13 departments, including five young people from the newly revamped youth entity, the National Youth Development Agency.

Presidency officials will accompany the delegation. Key departments that will be represented during the visit are the Departments of Energy, Mineral Resources, Tourism, Trade and Industry and Science and Technology There is also a strong business delegation, which is expected to be led by the chairman of the SA-Russia Business Council, Robert Gumede.

 

A wide range of issues are expected to appear on the agenda during the presidential visit, such as aviation safety, maritime transport, nuclear co-operation, mining, mineral resources and agriculture.

 

A high-ranking government official who has been privy to the preparation talks told Business Day that SA would be raising its gripes regarding Russian trade relations.

One of SA's concerns has been the recently imposed five-year import penalty surcharge of 33,3% on SA's Columbus Steel. Russia is accusing Columbus Steel, together with other entities from China, Brazil, South Korea and Taiwan, of dumping their steel products on the Russian market.

 

Also on the agenda will be cooperation in the field of energy affairs. GazProm, a Russian energy enterprise, is looking to explore new natural gas deposits along SA's western coast.

There are also plans to hold further discussions on the proposed Kudu power plant on Namibia's border with SA. It is estimated the plant will yield 50-billion to 60-billion cubic metres of gas.

 

Energy utility Eskom has reportedly shown interest in acquiring 500MW of the 800MW output from the Kudu power plant to increase its electricity supply to the local market.

Mr Zuma and Russia's President Dmitry Medvedev are expected to sign memorandums of understanding in the fields of plant quarantine and visa exemption for diplomatic and official passport holders. Other memorandums of understanding to be discussed or signed include maritime transport, aviation safety and an extradition order between the two nations.

Agriculture Minister Tina Joemat-Pettersson will raise the issue of ostrich meat, which Russia refuses to allow into the country due to health reasons.

 

With so many items on the agenda, it is likely that these discussions will yield positive results for both countries. However, only time will tell if Russia will be able to regain its position as an influential leading figure in African affairs.

 

 

 

 
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