Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, May 8, 1994 TAG: 9405060084
SECTION: CURRENT PAGE: F-1 EDITION: METRO
SOURCE: By LON WAGNER STAFF WRITER
DATELINE: LENGTH: Medium
The comment he heard took place at an exhibit of kitchen counters, which impressed a delegate from southern Africa. But first things first, he said. "We'll need those," Nicely recalled the man saying, "but first we need water."
The re-emergence of South Africa in the international community is being viewed by Virginia trade experts as just one more step in opening up all of sub-Saharan Africa's economic potential.
Within a month, Virginia plans to open a trade office in Gaborone, Botswana, using it as a platform for trade opportunities not only in the Republic of South Africa, but also in the other 10 nations of southern Africa.
E.W. Davis Jr., director of the state's Division of International Trade and Investment, said southern Africa countries generally need United States companies to help improve their roads, bridges and water lines.
"They need items that will help them build industrial parks so they can create investment," Davis said.
Southern African countries, many of which are rich in minerals and other natural resources, also need machinery to help build plants to mine their resources. Davis pointed out that in 1993 Virginia exported more industrial equipment than it did coal for the first time in state history.
Ingersoll-Rand Drilling Equipment, which runs its rock drill division out of Roanoke, has had an operation in South Africa for more than 50 years. Division General Manager Ernie Hinck said there had been a lull in business activity in South Africa for about a year leading up to the election, but Hinck expects that will change.
"I think people had just waited for the election outcome to go back into more of a buying mode," Hinck said.
Ingersoll-Rand's 300 workers in Alrode, South Africa, a town about 30 minutes from Johannesburg, make rock drills used to mine coal, gold, platinum and other minerals. Hinck said South Africa is so rich in natural resources that it is home to 35 large gold mining companies.
Magnox Corp. has in the past sold magnetic iron oxide to VCR and audio tape manufacturers in South Africa. Nicely said a more stable political environment in southern Africa would almost certainly mean more foreign investment in the region. Nicely pointed out that Zambia and Zaire have large deposits of cobalt, a mineral tape magnetic tape manufacturers need.
But many companies have been hesitant to get involved in trading with southern African countries, because of political uncertainty.
"I think everybody understands there is a risk involved down there of internal turmoil," Hinck said, "but I'd say in general people have waited until the election and now they're going to expand. That will certainly help us."
Nicely said the economics of the situation is more of a problem.
"The opportunities are boundless," Nicely said. "The biggest problem in those countries now is they have no money. They have a wealth of natural resources and plenty of labor, but they lack the in-between, the money."
Gary Saunders, vice president of Timber Truss Housing Systems in Salem, hosted a group of southern African officials during a conference last week at Virginia Tech. Saunders said Timber Truss hasn't done any business in southern Africa yet, and probably won't anytime soon.
"I just don't think they're in a position to import any housing yet," Saunders said.
by CNB