African economic governance improving - Davies

(Image: GCIS)

"Improved economic governance is underpinning the fact that Africa is experiencing a growth spurt. However, the challenge facing Africa is to transform that growth spurt into a sustained effort and development," said Davies at the South Africa-Turkish Business Forum in Istanbul, Turkey.

The business forum included break-away sessions and business-to-business meetings between South African and Turkish business people.

Davies told the meeting that Africa could not continue to grow simply on the bases of the supply of raw materials to fuel industrialisation processes taking place elsewhere. He stressed that in order to address this, the continent must engage "in a series of exciting ventures to boost and expand regional integration".

According to the minister, lack of infrastructure as well as the lack of productive capacity, were the biggest barriers to inter-regional trade in Africa.

"To overcome this, we need to promote a significant industrialisation effort across the continent," Davies said, noting that bilateral relations between South Africa and Turkey were well below potential.

In 2009, trade between South Africa and Turkey decreased significantly and this was mainly due to the global economic crisis.

In total, trade decreased from R10.6bn in 2008 to R5.1bn in 2009 and further to R4.9bn in 2010 after an upward trend from 2006 to 2008.

"The trade decrease is of concern but there is certainly room to grow the volume of two-way trade and investment, create a more diversified balance of SA exports, a greater proportion of beneficiated and higher value goods and services in our export basket to Turkey."

Davies's two-day official visit to Turkey started on Wednesday and yesterday he co-chaired the second session of the Turkey-South Africa Joint Economic Commission, which promotes trade, investment and economic co-operation between the two countries.