SA, Cuba sign trade agreement

SA, Cuba sign trade agreement
Fri, 26 Sep 2014 1:02 PM

South Africa and Cuba on Friday signed amendments to the Agreement on
the Economic Assistance, which will stimulate bilateral trade, among
other things.

The amendments of the agreement were signed by Minister of Trade and
Industry Rob Davies and Cuba Ambassador to South Africa, Carlos
Fernandez de Cossio, in Pretoria.

The signing of the amendments to the agreement is a follow-up to
President Jacob Zuma's 2010 state visit to Cuba, where he announced an
economic assistance package of R350-million to Cuba.

The multi-million rand economic assistance package was to assist with
agricultural development as well as in the reconstruction of
infrastructure following devastating hurricanes in 2008.

Minister Davies said from the package, R40-million would be granted for
the purchase of seeds.

"R5-million is for purchase of seeds in South Africa, and the remaining
R35-million for purchase of seeds either in South Africa or elsewhere in
the world," the Minister said.

He said R 100-million was allocated for purchasing goods on the South
African market and R210-million was for the credit line.

The credit line entails a first tranche of R70-million to be available
immediately on entry of the agreement into force. The second tranche of
R140-million is available after the repayment of the initial R70-million.

In 2012, Minister Davies signed the Agreement on the Economic Assistance
on behalf of South Africa with the former Cuban Ambassador to South
Africa, which was followed by ratification of the agreement by
Parliament that was finalised later that year.

He said the implementation of the agreement had been delayed by the
withdrawal of the Industrial Development Corporation (IDC) as a facility
agent, amongst other reasons.

"This meant that a new facility agent had to be found, and the dti is
pleased that Dirco [Department of International Relations and
Cooperation] - through the African Renaissance Fund (ARF) - agreed to
act as the new facility agent.

"The dti and other government departments such as the Department of
Agriculture, Forestry and Fisheries and the National Treasury as part of
a Steering Committee will continue to provide support to DIRCO," said
the Minister.

Minister Davies said the agreement required some amendments to make it
more exporter-friendly.

The amendments take into account, amongst other things, the concerns
raised by potential exporters regarding payment procedures in the
agreement, to ensure that small and medium term enterprises also
benefit by reducing the minimum amount for transactions to R100 000
from R2.5-million.

"The exporters wanted to have some guarantee of payment prior to goods
being shipped to Cuba," Minister Davies said.

Minister Davies said the agreement will be mutually beneficial to the
two countries. "We hope this will be a catalyst for strengthening
commercial relations generally," said Minister Davies.

Trade has increased between the two countries from R27.7-million in 2009
to R63-million in 2013.

De Cossio said amendments of the agreement would further Cuba in terms
of transformation.

He said Cuba was very happy that relations with South Africa had reached
this point.

"We are doing so in the context of the year in which we celebrate 20
years of diplomatic relations between our two countries."

He said Cuba was proud that South Africa was celebrating 20 years of
freedom and democracy.

South Africa would rank third in terms of Cuba's trade partners in
Africa, against Algeria and Angola.

SAnews

Source: iafrica.com SA, Cuba sign trade agreement -
http://business.iafrica.com/news/962580.html