South African Development Partnership Agency (SADPA): progress report

Meeting Summary

In its progress report, the Department of International Relations and Cooperation (DIRCO) gave an overview of the objectives, core programmes, macro-functions and the progress made in the establishment of the South African Development Partnership Agency. DIRCO has completed the following steps necessary for the establishment of SADPA: the business case, the draft Partnership for Development Bill (funding mechanism) which has been presented to Cabinet once so far and the institutional arrangements. The remaining steps are for the executive authorities of DIRCO and National Treasury to agree on the institutional arrangements and the Draft Bill. Once the Draft Bill is completed, it will be submitted to Cabinet for approval to gazette for public comment.

Committee members asked about the sustainability of creating yet another parastatal and the comparative advantage of SADPA for South Africa. The cost and benefits for providing assistance to the continent were discussed. The Committee requested that a more convincing business case need to be presented to convince them of the need for such an agency. The seven core programmes also needed to be elaborated on and the cost of providing assistance to the continent. The Committee and DIRCO will meet again for clarification on this.
 

Meeting report

Ambassador Ebrahim Saley, Chief Operations Officer for DIRCO, presented the progress report on the establishment of the South African Development Partnership (SADPA). The approach South Africa takes on development cooperation is that it is seen as a tool used to advance South African foreign policy goals. These foreign policy goals are guided by domestic priorities or national interests. South Africa’s approach has been informed by foreign policy, especially the goal of consolidating the African agenda through the support for the African Union, NEPAD and sub-regional initiatives under the Southern Africa Development Community and the South African Customs Union. The African Renaissance and the International Cooperation Fund have been the primary bilateral tools used for development cooperation in Africa. This links to the role of DIRCO which is to create a better South Africa and to contribute to a better Africa and a better world. To achieve this, South Africa, inspired by its national interest, has a vision to be a globally competitive economy and an influential and leading member of the international community. South Africa should be a key promoter and contributor to sustainable development, democracy, the rule of law, human rights, peace and security, within a safe, peaceful and prosperous Southern Africa and Africa.

This is fundamental to the vision that South Africa is and remains very much an African country. In setting out the South African priorities, the country first and foremost always expresses itself as an African country in a region that is integrating and in a continent where the cherished vision has always been of an integrated continent.

The core SADPA programmes were noted:
- Humanitarian Support
- Human Resource Capacity Building
- Post Conflict Reconstruction and Development
- Good Governance- Building Capacity for Elections
- Economic Cooperation
- Trilateral/Multi-partner Cooperation
- IBSA (India-Brazil-South Africa) Poverty Alleviation Fund

The macro functions of SADPA are to:
- Develop policy guidelines on outgoing South African development cooperation and ensure coherence throughout government in implementation;
- Support programmes and projects for outgoing development cooperation partnerships and use the Fund to support programmes and projects;
- Provide technical advice on foreign policy in the area of development cooperation;
- Build and maintain close cooperation and liaison with international development cooperation agencies and other stakeholders on behalf of the Minister of International Relations and Cooperation.
- Maintain oversight for all South Africa’s officials on outgoing development cooperation and assistance (for bilateral, trilateral and multilateral partnerships with countries, development institutions, civil society and the private sector);
- Conduct an annual accountability audit, and monitoring and evaluation for all outgoing development co-operation
- Ensure effective management and administration of the Partnership Fund for Development.

Ambassador Saley said that DIRCO has completed all the steps necessary for the establishment of SADP:
- The business case has been made.
- The draft Partnership for Development Bill (Funding Mechanism) was presented and
- The institutional arrangements.

The remaining steps are:
- The Executive Authorities of DIRCO and National Treasury to agree on the institutional arrangements.
- The Draft Bill, once amendment is completed, will be submitted to Cabinet for approval to gazette for public comment.

Discussion
Ms M Dikgale (ANC, Limpopo), who is the co-chair of the Parliamentary Group on International Relations (PGIR), said her question is around the next steps. They had a presentation from DIRCO in 2011 about SADPA and since then, the Committee had not been briefed again. She asked for the department’s timeline in coming back and updating the Committee on the developments. In her opinion, SADPA is a good programme which can help the people of South Africa if it were to be kick-started.

The Chair noted that the PGIR is currently exploring ways that Parliament could ensure the policies developed by DIRCO are in line with the thinking of Members of Parliament.

Ambassador Saley responded to Ms Dikgale’s question by first acknowledging her question as relevant and stating that SADPA is still a draft bill which has not yet gone to Cabinet. In the interim, the African Renaissance Fund remains in place. Having SADPA will bring a different dimension to development assistance targeted at the African continent, on the basis of humanitarian need in most cases and support for the development of democratic institutions. It will also allow for observation missions. The next steps are with the executive, namely the Minister of International Relations and Cooperation and her colleague in Treasury. It is a matter that needs to be resolved because it will impact legislation which will in turn need to go into the Bill. It primarily focuses on the need for concurrency from Treasury. Efforts have been geared towards trying to speed this up so that it is resolved as soon as possible. Since 2013, the Bill appears to have been thoroughly discussed. It went to Cabinet and the Cabinet asked for clarification between the two ministers. That is where it is in the process. He cannot specify specific dates since the procedure depends on the ongoing engagement at an executive level.

Mr W Faber (DA; Northern Cape) started his question by first stating that he did not want to always be controversial. The agendas proposed under SADPA is what DIRCO is already doing. He has observed in the past six years that new parastatals are created all the time. He is concerned that this is just about creating jobs which is money going out of the fiscus for ‘different cooperations and new establishments’. The question is that this takes a lot of work away from DIRCO or it creates a parallel since SADPA will be doing exactly what DIRCO does. He wanted to understand why this is happening since DIRCO has got all the knowledge. Even the Department of Trade and Industry has all the necessary information and equipped individuals to do the work. Therefore, the question remains why another parastatal under DIRCO is being established?

The Chair responded that Mr Faber had a valid question and he added to the question by asking what the competitive advantage for South African is and how the people of South Africa would benefit from it. How does SADPA ensure that this happens because foreign policy is supposed to benefit South Africans? Further, how would the programme deal with negative attitudes of some South Africans towards foreign nationals since the country is attracting more and more foreign skills. It would be important to see how DIRCO plans to deal with the negative attitudes of some South African toward such programmes.

Ambassador Saley stated that Mr Faber’s concern is very relevant. He answered with an example of meal assistance during droughts in Lesotho. This assistance also kick-started small scale farmers in South Africa. As a result, individuals in neighbouring countries would not necessarily leave their countries for South Africa as economic migrants. This is therefore in the interest of South Africa. It is also an obligation for South Africa to assist the region. South Africa should assist within its capacity.

Ms Dineo Mathlako, DIRCO Communications Officer, added to the response to Ms Dikgale’s question about the delays in kick-starting the programme. There are two relevant institutions, that is, the South African Partnership Development Agency and the Partnership Fund for Development. When it was created, it was envisaged that the agency would be running the Fund. Currently, there is the African Renaissance Fund. Therefore the Partnership Fund would repeal the African Renaissance Fund in order to give effect to SADPA. In 2013, SADPA was promulgated as a government component. It was understood at the time that the legislation would be passed shortly afterwards. However, because of the delays in passing the legislation, this meant that the agency was never activated. As a result, South Africa is at present using the African Renaissance Fund as the tool for development cooperation.

In response to Mr Faber’s question, Ms Mathlako explained that the African Renaissance was established as Act of Parliament in 2001. Specifically, DIRCO’s main mandate was to deal with bilateral relations at a political level and because development cooperation is a project lead process, there needed to be a separation of duties. Since DIRCO operates at a political level and the ARF is an implementation agency, the African Renaissance Fund was established to run projects on behalf of DIRCO so as to allow DIRCO to maintain its core mandate. SADPA would take over from the ARF. The reason there was a need to review the legislation for the ARF is because it was limiting. Since South Africa is a prominent player in BRICS, other countries wanted to partner with the country in terms of development cooperation. However, ARF does not have that ability. As a result, South African cannot enter in a trilateral arrangement with China to do projects in Ethiopia where China contributes money, for example. Since South Africa realised that it is not a donor country, it tried to find ways to cooperate with other countries of the South to create an impact on development. That is why there was a need to establish SADPA with an enabling legislation to allow the entity to enter into such arrangements.

Ms E van Lingen (DA, Eastern Cape) said that she is against development agencies because the country has enough structures to do the work that needs to be done. While it is important to understand that DIRCO aims to prevent hunger in the rest of Africa, it is also important to acknowledge that migration as a result of hunger will occur, regardless of DIRCO’s help. She expressed concern that South Africa is not taking care of its own people, which means that the country would have to import food. She questioned whether SA’s harbours would have the capacity for such imports and the roads the capacity to transport the maize. She stated that the country must not think that this programme will address the famine.

The Chair intervened saying that harbour concerns should not be raised with DIRCO but with Transnet. The Chair gave the example of Israel in Biblical times, that during the famine, Israel had to seek help from Egypt. Essentially, it is important for South Africa to contribute to the development of counties so that there is no migration. It is not to say that South Africa does not want migration but that should the situation in Lesotho for instance be favourable for agriculture production, people will not migrate. He gave examples of foreign assistance which had yielded positive outcomes such as the first democratic elections in the DRC and the assistance of the Gift of the Givers in Myanmar and Palestine. South Africa can position itself in such a way that international relations are not only concentrated on economics but are informed by humanitarian assistance as well. SADPA allows other relief agencies that are not government to also do their work to their best of their ability.

Ms van Lingen asked if the Chair is saying that the only way DIRCO can operate is with SADPA.

The Chair replied that they are not saying that the only way DIRCO can operate is through SADPA but rather that it works better with SADPA. They have tried it without SADPA and have learnt lessons.

Mr S Mthimunye (ANC; Mpumalanga) stated that DIRCO made good points and that he sympathised with Ambassador Saley and Ms Mathlako. His concern is that the progress report is too limited for him to be convinced that the programme is still necessary. As a result, a business case needs to be made to convince that the programme should still go ahead.

Ambassador Saley responded that there is a business case for SADPA and that DIRCO should be given time again in the future to elaborate on the business case.

Ms Dikgale added to Mr Mthimunye’s request saying that since DIRCO is going to make an additional briefing, then full information on the core SADPA programmes would be required, specifically in light of human capacity building. It is not sure who will attend these programmes.

Ambassador Saley acknowledged the request from Ms Dikgale.

Mr Faber stated that he fully understood the answer given by Ms Mathlako that DIRCO has certain functions. He also understands that the African Renaissance Fund of R230 to R300 million must help other countries. What is not said is that the estimate of the assistance is 1% of the country’s growth income to other African countries. Given that South Africa’s gross domestic product is R350 billion, 1% for assistance is a lot of money. As a result, the question still stood, why create other agencies as well? After SADPA is established, will the African Renaissance Fund fall away? He expressed concern about the financial implication and questioned whether the country will just see many parastatals created that are doing the same thing. He also believes that charity begins at home and that small maize farmers should sell to the local markets since South Africa is a net importer of maize. Imported maize should be utilised for foreign countries, including the finance that is already in place.

Ambassador Saley replied that since South Africa is a middle income country, a member of the BRICs formation, the G20 and a relatively high profile player in various sectors in the global arena, it is incumbent on South Africa to make the necessary contributions that are commensurate with South African projects in the international arena. It would be difficult if South Africa did not abide by the international norm of allocating a percentage of GDP for assistance. Since the world is facing difficult times and given that South Africa plays a very prominent role in the African Union and proclaims its African identity very unambiguously, it would not be in line with the identity of the country if it did not help people from neighbouring countries. The role played in the DRC is important because instability in the DRC contributes to instability in the rest of the continent. In this case, South African cannot envisage that it would be on a peaceful continent. Therefore it is in the favour of South Africa itself. What is of most importance is that the country cannot meet all the needs required by the continent but it can try to alleviate the more immediate needs. South Africa is the only government institution that provides development assistance. He understood that there are austerity measures for 2016 and 2017, which means that the Treasury allocation for African Renaissance Fund was negligible. He was told that the figure for assistance may even be R31 000.

The Chair, in his concluding remarks, gave the example of Volkswagen when it threatened to leave South Africa after some strikes. The South African ambassador at the time had to negotiate to prevent Volkswagen leaving South Africa. When South African delegations attend meetings such as those hosted by the World Trade Organisation, there needs to be one source to keep officials informed. SADPA is currently positioning itself to be that source to help the country in its political thinking and political interventions. The point made by Mr Dikgale is important, namely to look at the core programmes of SADPA. There are seven mentioned and these were not explained. Engagement on these will occur later. He said to Ambassador Saley that the Committee is leaving him with a lot of matters that they still require clarification on. The Members want to ensure they hold him accountable that when SADPA is established, it will be an institution that would meet the expectations the Committee has of it.

The Chair decided that it was fair to close the meeting even though the Deputy Minister had not yet arrived at 11:20, especially since there were further meetings to attend.

Committee Minutes
The minutes of the 27 January were approved and the minutes of 4 November 2015 were corrected.

Meeting adjourned.

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