Select Committee on Foreign Affairs Fifth Report

UK-South African relations

'Broad and deep'

38. The Foreign and Commonwealth Office (FCO), in its initial memorandum to the Committee, described the relationship between the United Kingdom and South Africa as, "broad and deep".[42] It highlighted a few of the significant ties that bind the two countries together:

  • £5 billion of two-way trade in goods and services;
  • £12 billion of United Kingdom investment in South Africa, making it the largest foreign investor there (nine of the top twenty foreign employers in the country are British);[43]
  • around 275,000 South African visitors to the United Kingdom each year, making it the country's most popular long-haul destination (accounting for almost 40% of all overseas departures), with well over 400,000 Britons going the other way, a number that is steadily rising year-on-year;[44] and
  • approximately 750,000 Britons living in South Africa, one of the largest communities of British expatriates anywhere in the world. Around 350,000 South Africans currently live in the United Kingdom.[45]

39. The Foreign Office stated that the United Kingdom and South African Governments work together on a wide variety of issues and at all levels of the two administrations. The Office highlighted the "mutual interests" the countries share, such as the promotion of sustainable development, support for the Middle East Peace Process (MEPP) and a commitment to fighting poverty in Africa.[46] It detailed, in particular, bilateral co-operation on peace-keeping activities, promotion of the New Partnership for African Development and the strengthening of trade links, all of which we examine in further detail below. There have been frequent high-levels visits, including those by HM The Queen in 1999 and President Mbeki in 2001. Cultural links are also very strong, with a recent highlight being the visit of the England football team and especially Mr David Beckham, which had done a great deal to raise awareness of Great Britain in the country. Other evidence we have received has similarly emphasised the strength and diversity of the ties that bind the two countries together.[47]

40. We are pleased to conclude that, in general, South Africa and the United Kingdom enjoy excellent bilateral relations on a very broad front of activities and interests. We recommend that the FCO, in its Response to this Report, sets out how it considers bilateral relations between the United Kingdom and South Africa could be strengthened further in the future.

'Periods of turbulence'

41. Although, on the whole, bilateral relations between South Africa and the United Kingdom are very good, there will always be aspects of the relationship which serve to create tension and occasional discord. During this inquiry, a number of key issues were brought to our attention as being such irritants in Britain's relationship with South Africa, which had helped to engender 'periods of turbulence' in the recent past. Some were long-term issues that included a wide variety of factors and players, others were specific problems that had arisen only recently. We wish to address four of these issues in our Report: trade liberalisation; the impact of the war in Iraq; development assistance to South Africa; and the perceived 'brain drain' from South Africa to the United Kingdom.

Trade liberalisation

42. On 14 September last year, the latest negotiations in the Doha round of world trade talks, organised by the World Trade Organisation (WTO), collapsed without agreement being reached.[48] No country or national grouping would take responsibility for the failure of the talks. The developing nations pointed the finger of blame at the United States of America (USA) and the European Union (EU), in particular, for being unwilling to cede ground on the vexed issue of subsidies for agricultural produce. On the other hand, many European countries were critical of African and Asian nations who had been unwilling to discuss restrictions on investment and competition. South Africa took a crucial role in the negotiations as a leading member of the G20+ (or G22) group of developing nations, along with the People's Republic of China, India and Brazil.[49]

43. Many of our memoranda and witnesses during the inquiry have highlighted the collapse of the talks, and the wider issues it raised of the inequalities in world trade, as being one of the biggest problems dogging South Africa's relations with the United Kingdom, and indeed the rest of the developed world.[50] Professor James Barber, of the University of Cambridge, for example spoke of the imperative to create a far more, "even field" in international trade.[51] Action for Southern Africa (ACTSA), in its memorandum, went so far as to say that South Africa's relations with the EU had been "poisoned" by its failure to reform the Common Agricultural Policy (CAP), in particular.[52] We also noted a recent article by the head of the South African delegation to the WTO, Faizel Ismail, in which he specifically makes clear South Africa's anger at the EU's agricultural subsidies in particular:

The EU is the world's largest subsidiser of agriculture and thus causes the greatest harm to the livelihoods of the world's poorest people in developing countries. Through a combination of high subsidies and high tariffs, the EU's policies stimulate agricultural overproduction in Europe, fuels artificially low world prices, and constrains and often prevents the access of developing country products to its markets. ... agricultural negotiations are the centrepiece of the DDA [Doha Development Agenda]. Failure to produce movements on this issue will slow down the entire process, bring the negotiations to a halt, and threaten the future of the WTO itself. EU member states are confronted with a choice between maintaining their protectionist positions on agricultural reform and their commitment to the multilateral trading system and development. How will the EU member states confront this reality?"[53]

44. In general, it was reported to us, the United Kingdom was seen as being more reasonable and progressive on the subject of trade liberalisation, and on reform of the CAP especially, than some other EU member states. However, with particular reference to Cancun, Professor David Simon, of the University of London, suggested that: "there was evidence that Britain did not dissent from the overall EU position which has caused some consternation among people in South Africa and others."[54] Mr Richard Dowden similarly commented:

That is really what South Africa and other African countries would like to see us doing: Britain being a much stronger voice in favour of a better deal on debt, on reducing agricultural subsidies, allowing Africa and other countries to earn their place rather than have to wait on aid.[55]

45. In his oral evidence to us, Mr Mullin acknowledged that this was an issue about which the South Africans felt strongly.[56] He believed, however, that they recognised the United Kingdom had played a "fairly honourable role" at Cancun, where the United Kingdom had been:

pressing very hard for trade liberalisation and the fact there was a failure was no fault of ours. I think that is widely recognised. Similarly within the EU we have played a leading role in campaigning for doing away with the CAP and reforming the agricultural subsidies.[57]

46. The Minister also highlighted the EU-South Africa Trade, Co-operation and Development Agreement (TDCA), which had been signed in 1999 but which was yet to be ratified by all parties.[58] The Agreement covers trade relations, financial aid and development co-operation between the Community and South Africa, as well as a number of other areas. Mr Mullin told us that, thanks to the Agreement, "by 2010 95 per cent—by value—of all South African exports to the EU will be free of tariffs."[59]

47. Despite this significant step forward in liberalising trade between the EU and South Africa, it is clear to us that the intransigent position adopted by some other member states towards trade liberalisation and CAP reform is undoubtedly continuing to damage the EU's relations with South Africa, and other developing nations, and with it the UK's bilateral relationship. From what we heard while in South Africa, we also fear that the Government is over-estimating the extent to which South Africa, and other developing nations, distinguish the United Kingdom as a "good guy" on this issue, compared to other EU member states.

48. We recommend that, within the constraints imposed on it by the United Kingdom's membership of the European Union, the British Government should do more to make clear its commitment to opening up trade to the developing world and reforming the CAP at all opportunities.

War in Iraq

49. As in the United Kingdom and elsewhere, the recent military action in Iraq aroused strong passions in South Africa. The majority of South Africans were strongly opposed to the war in Iraq and many government ministers put their objections on the record. In January 2003, President Mbeki himself said that: "We are not aware of any information that would suggest that Iraq has been in serious material breach of the Security Council resolution."[60] He also criticised what he saw as the hypocrisy of the United States: "They say nothing whatsoever against Israel's weapons of mass destruction. ... Of course, from their point of view, the matter has nothing to do with principle. It turns solely on the question of power."[61]

50. While visiting South Africa, we heard this opposition to the war repeated by a large number of interlocutors. Criticism focused particularly on what was perceived to have been the unilateralism of the USA and, it was argued, the consequent undermining of the role of the United Nations (UN). As Mr Mullin observed:

... it was the issue over the lack of a second resolution for the invasion at the United Nations. The South Africans, rightly, have a very high regard for the United Nations and they felt that the alliance should have received United Nations' endorsement before the actual invasion.[62]

He believed, however, that the relationship with South Africa was sufficiently "mature" that such differences could arise and be discussed sensibly.[63] He felt that it was no more than a "temporary phenomenon." We hope so too.

51. We conclude that the reputation of the United Kingdom in South Africa has undoubtedly been seriously weakened by differences in the two countries' approach towards Iraq. We recommend that the Government seek to repair the damage done to the relationship by this disagreement, at every possible opportunity.

Changes in development assistance priorities

52. In its supplementary memorandum to the Committee, the FCO noted a recent change in development assistance priorities of the Department for International Development (DfID):

Hilary Benn announced in January 2004 that DfID's programme of work in the middle-income countries of Southern Africa (South Africa, Botswana, Namibia and Swaziland) would reduce from £35 million in 2004/5 to £25 million in 2005/6, in compliance with DfID's commitment to spend 90% of its resources in low-income countries by that year.[64]

This reduction in the assistance being given to South Africa will impact on a number of the projects the British Government currently has in place in South Africa. It was made clear to us in South Africa that this reduction in the funds allocated to the country was deeply regretted, and that many co-operation projects would suffer as a result.

53. While the aid budget is wholly the responsibility of the DfID, this shift in priorities will inevitably impinge on the FCO's work in maintaining and improving strong diplomatic ties with South Africa. We were disappointed to learn from the Minister, therefore, that there had apparently been little prior consultation between DfID and the FCO on this matter, and to hear Mr Mullin dismiss the reduction as a "fairly minor irritant."[65] We believe that, although the reduction is relatively small in terms of the Government's overall spending on development assistance, this re-allocation of funds will have a significant effect at a micro-level, in South Africa. On crude indices, South Africa is indeed a middle-income country but these figures shield gross disparities income within the country (see paragraph 16). Money spent in the Republic is likely not only to be used more effectively but could also have a positive regional impact.

54. We recommend that, in its response to this Report, the Foreign Office sets out how the cut in DfID's assistance to middle-income countries will affect the Foreign Office's work in South Africa, and whether alternative sources of funding will be available to carry on some of the very valuable work being done there. We further recommend that the FCO set out what inter-departmental consultation took place prior to the re-allocation being announced.

'Brain drain'

55. Professor David Simon, and others who gave evidence to the Committee, highlighted the targeted recruitment by some United Kingdom employment agencies of South African doctors, teachers and nurses as a significant annoyance to the relationship. He questioned whether this was "ethical and/or appropriate" given the UK's concern for South Africa's development.[66] Mr Alastair Fraser, of ACTSA, echoed this concern:

it is something which enormously annoys both South Africans and the South African Government. It is quite a complex issue to try and find a solution to ... but there are numerous issues, some of them to do with the operation of British employment agencies which recruit in South Africa, both their recruiting techniques and what they are telling people the situation will be in the UK.[67]

It was noted by other witnesses, however, that South Africa itself has benefited from an inflow of skilled labour from other parts of the continent.[68]

56. Mr Mullin, in his oral evidence to us, recognised the seriousness of this problem.[69] He highlighted a recent memorandum of understanding that had been signed by the South African Health Department and the National Health Service on the subject but accepted that this would not stop the aggressive tactics of some individual agencies. The Minister concluded that:

We can certainly try to make sure that some ethical standards apply and we can try to make sure that there is a two-way fertilisation between out two health services, which is one of the things which this Memorandum of Understanding attempts to address.[70]

57. We recommend that the Government ensure that the United Kingdom, while respecting the rights of individuals, does not denude South Africa of its much-needed skilled professionals and continue to monitor developments in this area.

42   Ev 67, para 6 Back

43   Ev 71-72, paras 45, 47 and annex E Back

44   Ev 117, paras 4.1 and 4.4 [VisitBritain]. Figure for UK visitors to South Africa supplied by the South African Tourist Board. Back

45   Ev 112 [Mills] Back

46   Ev 67, para 6 Back

47   See, for example: Ev 99 [LGIB]. Back

48   For details of the collapse of the talks see, for example: "Investment row causes WTO talks to collapse", Financial Times, 15 September 2003. Back

49   At Cancun the G20 (sometimes known as the G20+ or G22) consisted of Argentina, Bolivia, Brazil, China, Chile, Colombia, Costa Rica, Cuba, Ecuador, Egypt, Guatemala, India, Mexico, Pakistan, Paraguay, Peru, Philippines, South Africa, Thailand and Venezuela. Colombia, Costa Rica, Peru, Ecuador and Guatemala have left since Cancun, and Nigeria, Indonesia, Tanzania and Zimbabwe have joined. Back

50   See, for example: Ev 110 [Mills] and Ev 17 [ACTSA]. Back

51   Q 11 Back

52   Ev 20, para 3.7 Back

53   Faziel Ismail, "An Insider's Insight", Africa after Cancun: Trade Negotiations in Uncertain Times, South African Institute of International Affairs, November 2003 Back

54   Q 12 Back

55   Q 124 Back

56   Q 173 Back

57   IbidBack

58   Q 174. At the time of writing, 14 of the 15 EU member states had ratified the agreement, leaving only one member state and South Africa (Ev 80). Back

59   Q 174 Back

60   "Mbeki broadsides Bush with tough anti-war vow", Saturday Star, 24 January 2003 Back

61   IbidBack

62   Q 182 Back

63   Q 184 Back

64   Ev 80 Back

65   Q 176-7 Back

66   Ev 6, para 3 Back

67   Q 70 Back

68   Q 70 [Blumenfeld] Back

69   Q 178  Back

70   IbidBack

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