THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Sunday, July 17, 1994 TAG: 9407160506
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY ALEC KLEIN, STAFF WRITER
DATELINE: GABORONE, BOTSWANA LENGTH: Long : 152 lines
The propeller stalled. One passenger pulled out rosary beads - as a joke to lighten the mood before takeoff in the Cessna 421c eight-seater. Then another passenger, E.W. Davis Jr., a former Air Force pilot, crawled out of the plane's hatch onto the runway.
His crisp, white, button-down shirt, which he had worn earlier that day in meetings with an ambassador and state minister, spilled over his belt as he stretched to pull down on the propeller blade.
The engine coughed, backfired, then finally revved. Davis, state director of international trade and investment, and the rest of the Virginia trade delegation lifted off into the expanse above southern Africa.
That moment in late June, though nothing more than a distraction, seemed to reflect the uncertainty, the effort and perhaps even the prayers of officials launching Virginia's latest foray into international trade.
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On July 1, Virginia opened its first trade office in Africa. The commonwealth, like investors elsewhere, is poised to tap deeper into vast markets now that South Africa has begun the process of dismantling apartheid.
``All of us are learning because we've accepted the existence of the past,'' said Frene Noshir Ginwala, South Africa's speaker of the parliament, during a private sitting with the Virginia delegation in Cape Town. ``But we are saying we have in many ways to build anew. . . . It's not simply tourism and trade. It's people-to-people relationships.''
The state already has established a relationship with the sub-Sahara. There is a hint in the region's tobacco shops, where merchants sell cigarette packs labeled: ``Philip Morris Inc., Richmond, VA.''
The numbers are promising: Virginia's exports to the continent rose 6 percent last year to $346 million. Of that, South Africa accounted for $54 million, third among African nations, behind Egypt and Morocco. From 1989 to 1993, Virginia's exports to the continent increased 61 percent.
And just two weeks after the June 26-July 2 trade mission, the state announced a new weekly private shipping line between ports in Virginia and South Africa.
The prospects, administration and business leaders say, are even better for trade with a region in need of technological and industrial goods:
l The Hampton Roads ports could diversify beyond traditional cargoes of coal and tobacco, which account for about 50 percent of exports. That could mean increased shipments of prefabricated homes, industrial machinery, pharmaceuticals and other consumer products.
l The Roanoke-Interstate 81 corridor could expand research and development in telecommunications and fiberoptics.
l Northern Virginia could generate more business in its software industry.
``I hesitate at this early date to put a figure on'' Virginia's potential windfall, said J.C. Polan, a former Botswana hospital executive who will lead Virginia's southern Africa office. But the 37-year-old Boston native added, ``Africa has its own evolutionary process. Regardless of the results, the particular numbers, it can only lead to more trade.''
Yet there is more at stake than trade with Africa. Gov. George F. Allen is looking globally, taking the lead from his well-traveled predecessors, Gerald L. Baliles and L. Douglas Wilder. ``I think,'' Allen said, ``the way we can expand is not just by selling amongst ourselves, but internationally.''
This week, he is traveling to Canada and Mexico to explore new business opportunities in the wake of the North American Free Trade Agreement.
Six months into office, the governor has staked his fledgling administration on creating jobs and expanding Virginia's tax base. Domestically, he has claimed a $650 million Disney project in Northern Virginia, tapped his wife, Susan Allen, to promote tourism and hired a high-powered economic development director to oversee the business-driven initiatives.
Meanwhile, economic development officials are reviewing prospects in Latin America and Eastern Europe. The Old Dominion has already extended its reach to other points of the globe with international offices in Brussels and Tokyo.
``Virginia is becoming more international,'' said Hugh D. Keogh, president of the state Chamber of Commerce. ``It's a microcosm of the global economy.''
The influence is apparent even stateside. More than 450 foreign subsidiaries, predominantly British, German and Japanese, have set up shop here. The influx began in the 1960s, but picked up momentum in the '80s.
South Africa may offer an emerging market for the '90s. The terrain is a world apart yet somehow evocative of a familiar scene. Here, in a land where motorists drive on the other side of the road, a metropolis like Johannesburg is only minutes from swaths of shanty towns, and those are only minutes from wild game preserves. Blacks are relegated to low-wage jobs, while suites at five-star hotels play Hollywood flicks chronicling the plight of blacks under apartheid.
Despite these paradoxes, there is hope for investment. ``I was sure at some stage, this problem (apartheid) would have to be resolved,'' said Zandisile Manona, a 37-year-old guide who spent for five years in prison for fighting against racial inequities in South Africa.
Government officials in the region are banking on that optimism. ``The main objective is to have foreign companies come here and invest here,'' said Dihelang Tsheko, director of trade and investment promotion for the Republic of Botswana, South Africa's northern neighbor.
``The ideal situation would be to buy directly,'' he said. ``We would like direct relations with Virginia. Virginia companies should set up branches here.''
But the rebuilding process is expected to be slow. South Africa has been a magnet for the region, to the extent that other nations have even been considered economic satellites. But while international sanctions have been lifted and South Africa has been welcomed back in the United Nations' fold, investors are still cautious.
Virginia's trade office opened not in South Africa, but just over the border, in Gaborone, Botswana's capital, a small but stable democracy strategically located to serve the southern region. Virginia has taken a conservative tack, giving the trade office a timetable to prove its worth.
``At the end of a year we'll see where we stand,'' said Davis of the division of international trade and investment.
The state has already tried to ensure some degree of success, having compiled a list of more than 1,000 potential Virginia exporters that could benefit from a strengthened link to southern Africa. And the risks are low. The trade office has been leased rent-free.
But with only a 12-month window, there is a lingering question of priority. ``It'll be hard to read the results,'' said Jimmy Kolker, deputy chief of mission in Botswana. ``The business atmosphere here is such that you need to build the markets.''
Although Allen has not visited the region as governor, he dispatched his wife to represent the commonwealth and expressed his commitment in a personal note to newly elected president Nelson Mandela.
Internal politics may have been a factor in the Republican governor's absence. In 1992, Allen's Democratic predecessor, Doug Wilder, put his imprint on the topic of business with Africa by becoming the first American governor to travel to the sub-Sahara on a trade mission.
Allen, however, explained in a recent interview that he had ``many previous commitments,'' including a day-trip July 1 to court the U.S. Olympic Festival in St. Louis.
Still, the governor and his wife were missed. The first lady, concentrating on promoting tourism, did not make the trip from South Africa to Botswana.
``It would have given a boost to the Virginia trade office if the governor had been able to come and do the official opening, because that's what we invited him to do,'' P.H.K. Kedikilwe, Botswana's minister of commerce and industry, said after lunch with the Virginia delegation at the Sheraton Hotel in Gaborone.
The minister's consternation, however, seemed tempered. We understand the governor had other commitments. We hope there are other opportunities.
And as he left the hotel, the minister sported a pin on his lapel: ``Virginia is for Lovers.'' ILLUSTRATION: Photo
ALEC KLEIN/Staff
A shanty town just outside Johannesburg, South Africa: It stands
just minutes away from the luxury of the city and the natural beauty
of a wild-game preserve. ``Despite these paradoxes,'' writes the
author, ``there is hope for investment.''
Graphic
JANET SHAUGHNESSY/Staff
VIRGINIA EXPORTS TO AFRICA
SOURCES: U.S. Department of Commerce, Virginia Department of
Economic Development
[For complete graphic, please see microfilm]
by CNB