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Now let's get down to business.

WITH THE demise of apartheid, South Africa is moving to establish an economic presence in the Arabian Gulf, despite the continuing official Arab ban on trade links with Pretoria. In late-May, the Durban-based shipping company Unicorn, in joint venture with Belgian shipping line CMB Transport (CMBT), started the first direct sailings from South Africa to the Gulf. Two container ships, the Bagatel and the Eliza, are operating the fortnightly services from Durban, via East African ports, to Dubai returning via Karachi and Bombay.

Mike Ford a senior Unicorn executive, said that Dubai would be "the hub of distribution to all parts of the Gulf". He stressed that Unicorn had encountered no political difficulties arranging the service. He and a colleague had toured the ports to call in late February. "Everywhere we went we were received warmly," Ford said.

The new shipping service is only one in a series of indications of South Africa's hopes for exports to the Arab world. At a business conference in Pretoria last September, a senior foreign ministry official, Neil van Heerden, said: "Bearing in mind that business [in the Middle East] is done in hard currency, it becomes very nearly irresistible."

The following month two teams, comprising representatives of 20 South African companies, visited Egypt and several Gulf states to explore the opportunities. Another large delegation, headed by the official South African Foreign Trade Organisation, toured the Gulf in May.

Unicorn and the South African private airline Flitestar will meanwhile be among the co-sponsors of a South African trade show in Dubai in October. The same month, Flitestar will inaugurate the first direct flights from South Africa to Bahrain, via Mombasa in Kenya. Bahraini aviation officials were exuberant. "It's the first time a totally new carrier to the region has come to Bahrain first," one was quoted as saying. "We will be the first airport in the region to have direct access to the southern part of the continent, and it will fill a major void in our network."

The flow of businessmen exploring the scope for trade is not just one way. A delegation from the Bahrain Chamber of Commerce recently visited South Africa. "We were impressed with the degree of interest in this region" one of them commented. "They have made it a top priority for trade in the future."

Following the visit, the Bahrain Chamber's vice-president, Hassan Zainalabedin, urged a formal normalisation of political and economic relations with Pretoria. "The time is right . . . many changes have taken place in South Africa."

For South Africa, access to Middle Eastern oil is a key consideration. Even in the bad old days of full-scale apartheid, much of the country's oil came illicitly from the Middle East. Already the flow, organised by independent traders, appears to have increased sharply -- to the point where Pretoria has been able to dispense with the strategic oil reserves it once maintained in disused mines. Space in the storage caverns is now being offered for rent to international oil companies.

Officially, the Arab League is likely to lift its sanctions only after the Organisation of African Unity (OAU) has dropped its own embargo of South Africa. Unofficially, normalisation is already well under way.
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Title Annotation:Business and Finance; South Africa's economic initiatives in the Middle East
Author:George, Alan
Publication:The Middle East
Date:Jul 1, 1992
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