The re-imposition of the US sanctions has been followed by the stall of crude oil import from Iran to South Africa and its continuation has challenged the future plans of the new South African Ambassador to Iran. Such trend happens in spite of the fact that he believes by focusing on economic potentials in common, there could be new horizons in the economic sections between the two countries which can led to their continuous cooperation.
AVA Diplomatic’s Exclusive Interview with
Mr. Vika Mazwi Khumalo, South Africa’s Ambassador to Iran
Interview by Mohammadreza Nazari
Before your South African Ambassadorship to Iran, what other diplomatic and non-diplomatic positions has His Excellency served?
From January 2012 to December 2015 I was based in Ankara as the ambassador extraordinary, plenipotentiary and accredited to Azerbaijan and Uzbekistan. From January 2006 to December 2011, I have served as the South African Consul General in Shanghai, China. From 2009 to the end of 2010, I served as the Commissioner General for the South Africa section during the Shanghai 2010 World Expo. I have also worked for the Department of Trade and Industry. And from 2000 to 2003, I served in Chicago as the Foreign Economic Representative focusing on the recruitment of investment for South Africa. Besides that I have also worked at the private sector where I have managed a couple of businesses and chaired two companies. My last position before I came here was that of the senior president of a wine company.
Considering the re-imposition of the US sanctions on Iran, how do you see the realization of the economic plans between the two countries?
Not everything is under sanctions. There are also quite a number of other areas/sectors that South Africa and Iran can focus on. So our attention has turned to SMEs that could be used to do business between our two countries. For instance, agriculture, autos, pharmaceuticals, mining and many many others.
In a meeting you had with President Rouhani, he stressed that Iran and South Africa can be complementary to one another. To make this possible, what areas of cooperation should be focused on between the two countries?
We can cooperate on a number of sectors as already indicated above like petrochemicals, beef exports, citrus fruits and many many others.
As you may well know we have opposite seasons so this offers an opportunity for both countries to grow their export in this sector. The petrochemical sector has a huge potential for cooperation
In the cases you spoke of, wasn’t there any cooperation or operational overlap in joint economic projects?
A South African company, MTN, went into a joint venture with Irancell. There are no other joint ventures at the moment. However, a lot of opportunities still exist for joint ventures both in Iran and South Africa.
There have been a number of delegations between South Africa and Iran. The last one was that of Vice President for Science and Technology to South Africa who took with him about 55 companies and some of them have partnered with South African SMEs in different areas like health services and other innovation and technical areas of business.
How much crude oil has South Africa imported from Iran in the first half of 2018? How has the import diagram changed in this area? Why didn’t South Africa receive exemption from sanctions the same way some other countries did?
South Africa used to import 70% of crude oil from Iran. And when the UN sanctions were introduced we cut our imports to zero. Now this was simply because we could no longer import, so we found other sources that replaced Iranian crude.
Can the establishment of a joint banking line between the two countries contribute to the bilateral economic ties?
Currently South Africa does not have an Iranian bank. For ease of economic transactions, the two countries have to establish a mechanism that makes it possible for financial transactions to happen.
We are hopeful that the INSTEX in due course will make it possible for countries like South Africa to participate. The alternative would be an establishment of a special purpose vehicle between southern African countries who are part of the southern African Development Community (SADC) and Iran. The SADC is made up of 15 countries. I think this is something we need to look into as a region and as a continent in order to continue to trade with Iran without the impediment of American sanctions.
Is there any ongoing negotiation regarding a bilateral banking line?
For this to be possible Iran would need to comply with the full international standards and regulatory framework as espoused in FATF including the CFT and Palermo Conventions.
How can the two countries’ businessmen keep their contacts without any banking or credit lines?
South Africa and Iran need to focus more on doing business between the two countries’ SMEs. This is most likely to facilitate or create an alternative way of financially settling payments. For example, the two countries need to consider paying in each other’s currencies or find a more modern form of bartering that balances the payments for the businesses involved. I am sure some creativity needs to go into this. One can also think of e-commerce as a more viable option. One wonders if how viable cryptocurrency payments would be for the two countries. More research is needed.
You pointed out that there are potentials for collaboration in terms of fishery activities. Have these possibilities been realized or they’ve just remained as potential as they were?
There are possibilities, collaborations and work in progress in areas of aquaculture, poultry, ostrich farming and beef imports that are currently being considered
How are health and medical collaborations between the two countries?
Iran has a very good health sector. It produces very good medicines, excellent medical students, which confirm that you have exceptionally good medical schools. Iran also has pharmaceutical companies that produced non-generic medicines which are more affordable for most developing countries.
Is academic cooperation foreseeable between the two countries?
Yes, like what I have said about medical schools, we can also bring some of our students to Iran, like you have Iranian students in South Africa. There is a possibility of bringing South African medical students and students in different disciplines to study in Iran. Our interest is more in postgraduate students. So we would like to see more collaborations between Iranian universities and South African universities. South Africa has some top medical schools and globally recognized and ranked business schools. South Africa also has the largest global online university, University of South Africa (UNISA).
What agreements were reached on the visit of South Africa’s Science Minister to Iran?
I think there are a number of areas that the two countries have identified that is why the Iranian Deputy President for science and technology made a follow-up trip to South Africa to make sure that those agreements that were entered into are realized or implemented. He took 51 knowledge-based companies to South Africa. Amongst others are polymer and petrochemicals, information technology, oil and gas fields, fisheries, nanotechnology, stem cells, and many many more. In health sciences, we may want to mention that we are amongst the top leaders in nuclear science medicine, which replaced our previous nuclear weapons programme. South Africa is also a leader in laser technology. Therefore, there will be a lot of collaboration in many of those areas that the two countries have agreed to jointly work on.
A few months back, the joint military commission was held between the two countries. What did it achieve?
This collaboration includes an exchange of expertise and training of our defense forces, health sciences, veteran affairs, education and training. Another area of interest is the veteran affairs which will give us an opportunity to benchmark service provision and benefits that are offered to military veterans.
Does South Africa have any new investment plans for MTN in Iran?
MTN is a privately owned company whose investment decisions are based on their own strategic investment interests. I am sure once the decision has been made we shall all be in the know. I haven’t discussed this with the MTN as yet.
Given that most of the auto spare parts for automotive giants such as Mercedes Benz are manufactured in South Africa, do Iranian car manufacturers have any negotiations with their South Africa counterparts?
It should be born in mind that auto component manufacturing is a global business; South Africa competes globally with other such companies to supply OEM (Original Equipment Manufacturers). Some time ago I met with Saipa and we are exploring a possible collaboration and supply chain avenue that would deal with auto component manufacturing.
What touristic potentials are there between the two countries? What facilities has Your Excellency considered in this area in 2019?
We just had a tourism forum more than a month or so ago in which Iranian tour operators met with South African counterparts. The purpose is to enhance working together in promoting tourism between our two countries. Agreements will be based on what these tour operators want to achieve which is promoting tourism between South Africa and Iran and vice versa. We are optimistic that the potential for tourism between our two countries is very positive. There is no doubt that there is a very bright future in that sector. Let me add that South Africa’s tourism promotion will be extended to two other parts of Iran like Esfahan, Shiraz, etc.
News has it that touristic visa issuance is being lifted for Iranian and South African citizens. Is that true?
The South African Department of Home Affairs, which manages visa issuance matters, has developed a package for various countries, and this is based on reciprocity. This means that as soon as the Department of Home Affairs in South Africa and the Ministry of Interior Affairs in Iran are agreed on the implantation date, this agreement will become operational.
How many Iranians visited South Africa in 2018?
It’s very small and it’s not significant, about four thousand five hundred. When the JCPOA was signed we saw the numbers of tourists from Iran to South Africa increasing exponentially; however, with the US unilateral withdrawal from this agreement, and the unjustified and uncalled-for imposition of American sanctions, the number of Iranian tourists has dwindled.
How many Iranians are attending college in South Africa?
The number of Iranian students choosing to study in South Africa either for short-term courses or long-term courses has been increasing over the years. It is difficult to put a finger on the exact numbers but it would be fair to say that we will continue to see a steady flow of students going to South Africa.
Taking into account the drop in IRR value against USD, can Your Excellency consult with South African officials to consider easing the tourism processes for Iranian tourists. Have you had any negotiations on this matter?
Iranians are travelers by nature. A large number of Iranians travel to different countries around the world. South Africa is a destination that is a bit further from Iran and it costs a little more and it leads to less Iranians visiting South Africa. What we are trying to do is to revisit that and look at how we can alleviate some of the challenges that Iranian tourists face. The tour operators will come up with different packages to make it easier for people to travel to South Africa. This means that if they travel in groups it will make it cheaper, than travelling individually. Tour operators are arranging group travels, can negotiate packages with the airlines and hotels to bring down the costs. So this is what we hope to achieve. This does not mean that individuals cannot travel cheaper. It simply means that it has to be better planning, better negotiation with tour operators for a better price for an individual ticket and affordable accommodation.
A while ago, the Human Rights Council was after passing a resolution against Iran and South Africa voted against it. Given that, how do you evaluate the political relations between the two countries?
Iran and South Africa collaborate in many multi-lateral forums. They cooperate to pursue peace and stability and the protection of human rights. Human rights is a corner stone of our foreign policy and South Africa will maintain its principle position for the protection of human rights and where necessary stand up against nations that violate the rights of its people.
The fact that we vote with some countries even when they are accused of such things, that means we aren’t partisan, we remain committed to our policy and to the way we see a human right issues and a number of other issues. So yes our relations are strong and continue to work with each other. We are grateful for Iran’s support in being elected for a third time as a nonpermanent member to the UN Security Council. We will continue to work together on issues of mutual interest to bring about international peace which is very critical to us.
As you know, Mr. Trump’s statements and decisions have always been challenging. In his recent words, he said that he is concerned about “land and farm seizures” and “killing of white farmers” in South Africa. What changes have US-South Africa ties undergone during Mr. Trump’s term as President?
First let me say the withdrawal of US from some of the international treaties has caused a lot of division among some countries in their fight against issues such as the climate change agreement and the international trade cooperation. The unilateral US withdrawal from the JCPOA which was regarded as an agreement that would bring peace and stability in the region has caused unnecessary division and confusion. South Africa supports the JCPOA signed between Iran and international community and believes that President Trump’s withdrawal from the JCPOA was uncalled for and a gross violation of international law. South Africa further believes in the sovereignty and territorial integrity of other countries. To this end, non-interference in the internal affairs of other countries, and the firm belief that people of the countries should decide their own destiny. What President Trump has tried to do is to divide the international community. He did not study the document that talks about land expropriation and our President has publicly been quoted as saying that Mr. Trump should keep his nose focused on the US and not interfere in other countries affairs; South Africa does not interfere with America’s domestic matters. Our relations with the US are very good, the US is one of our major trading partners, so we have not been against the American people, and we remain committed to good relations with all countries.
Will the talks regarding the amendment of the South African Constitution be put into practice anytime soon?
The Freedom Charter says South Africa belongs to all who live in it. Now, the main issue is that a large portion of the land is in white hands, about 87%. Black South Africans still own roughly 13% of the land. This is unsustainable. After 25 years of liberation, this must change. The people of South Africa, through their representatives have decided to amend Section 25 of Constitution to allow the expropriation of land without compensation. We are going to do this in a very orderly fashion which does not undermine food security. A majority of our farmers and citizens agree with this change, including white farmers who own large portions of land. They would like to work very closely with the government in reapportioning of the land, giving it back; which means giving it back to the majority of our people to be able to pursue a number of entrepreneurial activities, and to be land owners in their own rights. Institutions that own large portions of land have also come to party to say yes they are happy with this amendment. We have very good examples of farmers who have included in the agricultural sector some of the workers to be co-owner of the land. They have divided the land to give it to some of the people that work for them. We do not want to compromise our food security, so it is going to be done in a way that is most acceptable to all of us.
Considering that weapon manufacturing is a main source of income for South Africa, I read in a report that there have been talks to make Saudi Arabia a shareholder in this industry. Is that really so?
South Africa has a diversified economy. We do not depend on one sector. Agriculture, mining, tourism and the services sectors, amongst others, are major players in our economy.
What do you think about Mr. Trump’s decision to appoint a purse designer as the new US Ambassador to South Africa? Is that supposed to give any particular message?
If she is confirmed South Africa will receive, treat and give her the respect the respect we give to all our diplomats. I can’t comment whether or not she is qualified to serve as an Ambassador that is not my forte. All I know is she is a former citizen of South Africa which means she knows and understands South Africa very well. Let’s hope she will use that to her advantage and I wish her the best of luck.