Government plans to conclude several deals in the energy sector with Saudi Arabia. The Department of Trade and Industry is currently hosting the 9th session of the South Africa-Saudi Arabia Joint Economic Commission (JEC) in Pretoria.
The department together with their counterparts also launched the South Africa- Saudi Arabia Joint Business Council. South Africa is hoping to secure investment deals with Saudi Arabia in energy, tourism, agriculture, manufacturing, film and media.
Saudi Arabia says it will help South Africa accelerate its transition to cleaner energy. Saudi Arabia is in talks with government to invest in renewable energy as the country battles one of its worst energy crisis in decades.
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Saudi Arabia Minister of Energy Akram Jadawi says they are also exploring gas. He says they will continue having dialogue with South Africa and help it resuscitate its energy sector.
“Definitely when it comes to energy we have South Africa on the top of our priorities, we are both members of the G20 countries and we compliment each other. There is lots of potential, lots of opportunities and there are a lot of hanging fruits and we are trying to cease these opportunities. We talked about signing an MOU on renewable energy. This is one of the trends around the globe to reduce carbon monoxide and we in Saudi Arabia are very much active in that.”
Government is also hoping to secure more petrol and diesel. This comes amid threats by oil producing countries OPEC to cut back oil output to push up prices.
“Other opportunities we have talked about is the floating power ships which should supply electricity to very remote areas and this is one of the things we have discussed today along with the petrol chemicals mid- stream, upstream storage. Definitely all the value chains of the energy sector,” says Minister of Trade, Industry and Competition Ebrahim Patel
“We are looking at the entirety of the economic relationship between South Africa and Saudi Arabia and energy more generally is part of that discussion. We have identified a number of sectors ranging from manufacturing to renewable energy, there is already a Saudi Arabia company in South Africa producing energy for our grid. We will also be looking at the whole agro- processing value chain because we need to create more jobs in South Africa for smaller businesses,” adds Patel.
Meanwhile the launch of the South Africa-Saudi Arabia Joint Business Council will bring together captains of industry from both countries to deepen economic ties.
Saudi Arabia is South Africa’s strategic partner in the Middle East and the largest source of imports from the region. The exchange of political and business visits by both countries in the past years have yielded positive effects on trade and investment.
Total bilateral trade between South Africa and Saudi Arabia was around R66 billion in 2021. However, there is a trade imbalance between the two countries. South African exports to Saudi Arabia amounts to R5,54 billion and imports from Saudi Arabia amount to R60 billion.
Chairperson of the council Stravos Nicolaou says, “South Africa is a gateway to the African continent, a market with 1.3 billion people and Saudi is a lead and a gateway to to the Gulf. So there is a lot of complementarity around our geo strategic positioning. So we are wanting to do with this council is not only create investment opportunities bilaterally, promote and enhance trade but also to redress that trade deficit that exists.”