Speech at a business seminar in South Africa

State Secretary Marianne Hagen's speech at a business seminar in South Africa.

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Good morning.

It is a great pleasure for me to open this seminar on new business opportunities in South Africa for Norwegian companies and their partners.

Economic diplomacy and promotion of trade and investment are very high on the Norwegian Government's list of priorities. Stronger economic relations is a key goal for our bilateral relations with South Africa.

And let me be clear: We would like to see more trade and investment both ways. There are still those who see trade as a zero-sum game, where exports are good but imports are bad. We are most certainly not among them. Norway has become a prosperous country – not despite being an open economy, but because we are open to trade and investments.

Globalisation has been good for us, as it has for hundreds of millions of others who have been lifted out of poverty over the last three decades, thanks to the opportunity to trade with the outside world.

We would like to export more to South Africa. We would like to see more Norwegian companies taking advantage of the opportunities here for trade and investment. But we would also welcome more South African exports to Norway. And we would like to see more South African companies grasping the investment opportunities in our country.

We do indeed see new business opportunities in South Africa. It is very positive that the new South African Government under the leadership of President Ramaphosa has made economic growth and investment a top priority. This Government is committed to creating a more predictable business environment and advancing a pro-growth agenda.

The South African government's intention of signing of 27 agreements with private renewable energy providers is a good example of the way this agenda is moving forward. Even though these agreements are currently being challenged in court, I am convinced that renewable energy has a great future in South Africa. But I want to underline that it is very important to keep up the pressure and the time frame for the process.

I look forward to listening to Chris Yelland, a renowned South African energy expert. I am also pleased to welcome Jan Fourie from the Norwegian energy firm Scatec Solar, which already has a successful business here and is now looking forward to expanding – both in South Africa and on the rest of the continent.

South Africa and Norway are a good business fit in many sectors. Norway is an important energy country with successful companies and technologies both in the oil and gas sector and in the renewable sector. This means that we have a good starting point for seeking further business opportunities in the expanding South African energy sector.

The Norwegian oil company Statoil is the world's largest offshore operator. About half of its production takes place outside the Norwegian continental shelf, including in Africa – in Algeria, Libya, Angola and Nigeria. In 2015 Statoil moved into the South African continental shelf where it currently has four exploration licences. This could lead to major investments in the future – if the conditions are right.

At the same time, Norway is one of the bluest economies in the world. We have harvested resources from the ocean for more than 1000 years. These resources have been the basis of extensive trade for hundreds of years. First fish and shipping. Then, 50 years ago, oil was discovered on the Norwegian continental shelf. Norway had very little know-how in this sector at that time. However, we have gradually established a world-leading offshore service and supply industry. In tackling the challenges of operating in some of the harshest waters in the world, we have developed state-of the-art technology and expertise that is exported all over the world. About half of the output from our petroleum service and supply industry is exported.

Norway is investing heavily in the Blue Economy. In addition to oil and gas production, our Blue Economy includes:

  • Seafood – fisheries and aquaculture
  • Bio-technology and bio-prospecting
  • Maritime services – oil/gas, pipelines, cables, and of course shipping
  • Energy – wind/wave/hydro

In 2017, our oil and gas exports amounted to about 650 billion rand, and accounted for 50 % of our total exports. We also exported fish and seafood to a value of 145 billion rand.

The Norwegian Government's net income from oil and gas is transferred to a sovereign wealth fund and invested globally in equities, fixed income and real estate. For example it has investments amounting to 60 billion rand in South Africa. The fund – the Government Pension Fund Global – is today the world's largest of its kind with assets of about one thousand billion USD. It is being maintained for future generations, and we only use the real returns to finance government expenditure today.

I know that South Africa also has great ambitions to grow its Blue Economy, and this will mean new opportunities for Norwegian companies. I am also aware that the target of Operation Phakisa is to create up to one million new jobs by 2033. We would welcome closer cooperation and stronger business ties both in the Blue Economy, and in other sectors.

Meanwhile, South Africa and Norway already have extensive cooperation in the Blue Economy. We have recently signed a research cooperation agreement – Sanocean – in this field. Both countries will provide funding for research in this area of common interest.

We are also cooperating with the Fisheries Law Enforcement Academy at the Nelson Mandela University. And we are financing a feasibility study on how to combat marine waste, which is being carried out by a South African partner. Marine waste is a serious problem – but it also represents business opportunities for both countries.

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Norway is a resource-rich country. Our resource wealth – petroleum, fish, and forests – has been a crucial factor for our prosperity. But even more important than these natural resources is the way we use our most valuable resource – labour. Or, to quote the Nobel laureate Paul Krugman: Productivity isn't everything, but in the long run it is almost everything.

To stimulate productivity and growth we need to embrace and invest in new technologies. Therefore, I am very pleased to welcome Robert O'Keeffe from DNV GL, who will talk about digitalisation – its challenges and opportunities. He will also talk about another topic that is close to my heart – the Sustainable Development Goals. All the world's governments have committed themselves to achieving this set of goals – not only the developing, but also the developed countries. And this also means new business opportunities.

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I am always happy to promote trade and investment. I hope the various efforts and activities that we are involved in will be beneficial for businesses in both Norway and South Africa. And that – together – we will move closer to our goal: even stronger economic relations between South Africa and Norway.

I wish you a successful business seminar.

Thank you for your attention.