1. Presentation to the Portfolio Committee DIRCO

2. INTRODUCTION
The Department of International Relations and Cooperation derives its mandate from the Constitution of South Africa and the NDP vision which is further detailed in the MTSF provide an overall mandate and scope for all work done by national, provincial and local government and informs SA’s foreign policy
The draft White Paper on South Africa’s Foreign Policy was approved by Cabinet and submitted to Parliament
Under MTSF Outcome 11, Government seeks to “Create a better South Africa and contribute to a better and safer Africa in a better world” through:
Enhanced African Agenda and sustainable development
Regional integration
Reformed global governance institutions, and
Trade and investment

3. INTRODUCTION
Therefore the department’s spending focus over the medium term will be on:
sustaining economic and political relations,
participating in the global governance forums,
enhancing operational capacity by strengthening policy and coordination in relation to outgoing South African development cooperation and to table the SADPA Bill
Agenda 2063
review of the current legislative framework governing the department’s operations abroad, tabling the Foreign Service Bill
undertaking of various infrastructure projects, and implementing the property management strategy

4. South Africa’s Current Global Stature
In its execution of SA’s foreign policy DIRCO is informed by SA’s global stature where SA:
is a respected, active and responsible global citizen.
hosts the second largest number of foreign representation in the world and has a current global footprint of 125 Missions
Is regarded as a champion for protection and promotion of human rights
Advocates for disarmament and the peaceful resolution of disputes
Place Africa central in its Foreign Policy which forms the basis for cooperation with countries of the South and the North.
- Champions cooperation and partnership over competition in the global arena.

5. South Africa’s Global Footprint
Missions per Region
Africa Bilateral – 46
Africa Multilateral – 1
Americas & Caribbean – 17
Europe – 27
Asia & Middle East – 32
Multilateral -2
Total: 125

6. The changing global environment impacts the execution of DIRCO’s mandate
Shifting political ideological implications- The emergence of nationalistic and conservative governments reduced development aid to developing countries (0.4% drop in 2012)
New trend in trade and economic patterns – Asia and the Middle-East surpassed Europe as SA’ number one trading partner
In two decades, trade with Asia and the Middle-East increased 19-fold from R40.2 billion in 1994 to R760.2 billion in 2013
In the same period, trade with Africa increased 35-fold from R11.6 billion to R385 billion
Europe remains SA’s main strategic trading block while it continues to recover from the impact of the global financial crisis

7. The Changing Global Environment
Growing influence of new formations and regional groupings: Brazil, Russia, India, China, South Arica (BRICS), GROUP OF 20,(G20) ,Colombia, Indonesia, Egypt, Turkey, South Africa (CIVETS ), Indian Ocean Rim Association (IORA)
SA attaches importance to its membership of BRICS
China is the second biggest economy in the world after the USA, while Brazil and Russia and India are placed 7th, 8th and 10th respectively
BRICS countries share a common vision to be pursued through economic cooperation, sharing of technical expertise, knowledge and experience to address their own domestic and international challenges

8. The Changing Global Environment
Growing impact of non-state actors and social movements: growing social disparities, economic and financial volatility, insecurity and scarce resources
New global opportunities and frontiers: The ‘New Economies’ - the Blue Economy, the Green Economy and the Knowledge economy; exploration and utilisation of outer space (SKA project, satellites for communication, defence and environmental surveying) and advances in technologies
Operation Phakisa seeks to harness and leverage some of these sectors as part of NDP implementation

9. Global Trends that Impact on SA’s Influence
Economic migration: More than half of global population is urbanised ( as compared globally, Africa accounts for only 40%)
There is an increased number of mega-cities in developing countries
However, infrastructure and the provision of service is lagging behind and has socio-economic and political implications.
Regionalism: economies of scale, eroding sovereignty, protectionism vs cooperation for mutual benefit
This occurs while developing economies are moving, steadfastly, towards consumer-oriented economies

10. Global Trends that Impact on SA’s Influence
The future role of global governance institutions (UNSC, BWI): Reform or Replace.
- The impact of the global financial crisis led to increased voices for reform of international financial architecture

11. Overview of the MTEF allocation
In terms of government priorities of doing more with less, the allocation to the department over the medium term include Cabinet approved reductions of R335.3 million in 2015/16, R467.1 million in 2016/17, and R168.5 million in 2017/18, which the department has to effect on compensation of employees due to vacant posts, goods and services and the transfer to the African Renaissance and International Cooperation Fund.
The Department has proposed additional cost saving measures to unlock its fixed cost overhead expenditure items and mitigate the budget shortfall envisaged, including to accommodate some of the new priorities identified for implementation.

12. Overview of the MTEF allocation
In response to the budget reduction the department is implementing the following additional cost containment measures:
Review of the organisational functional assessment for both Head Office and missions abroad
Review of the provision of support services for the missions’ operations.
Enhancing information and communications technology through modernising and implementation of an enterprise resource planning system.
Implementation of property management strategy

13. Overview of the MTEF allocation
The 2015 MTEF allocation does not cater for the foreign exchange fluctuations as a result the department remains vulnerable to foreign exchange rate losses, which necessitates a review of how the foreign operations are supported. The department will address the shortfall through the adjustment estimates budget process.

14. Programme 1: Administration
Purpose
Strategic objectives
Provide strategic leadership, management and support services to the department
To manage resources efficiently and effectively through sound administration and good governance
To implement effective HR management to ensure that adequate and sufficiently skilled resources are in place and that performance is monitored
To provide effective training and research in support of departmental strategic objectives
To establish an adequate, effective and efficient system of internal controls and corporate governance
To establish a culture of risk management, governance and ethical behavior to ensure improved internal control environment and performance
MTEF allocation (R’ million)
2015/16
2016/17
2017/18

15. Programme 1 MTEF targets
Key Result Area
MTEF Target
ICT
Financial, HR and administration systems integrated
Financial Management
Procurement 100% aligned to Demand Management Plan
100 % compliance with 30-day payment
Security
252 fieldwork investigations for vetting per annum
36 security inspections, 36 security awareness sessions, 36 security audits
Property Management
Two construction and 17 renovation projects completed
Human Resource Management
Improve turnaround times to meet the DPSA standards, 4 months to fill vacancies, grievances handled within 30 days and disciplinary cases finalized within 90 days
Skills Development
282 training programmes (94 per annum)
Six training programmes to international participants

16. Programme 2: International Relations
MTSF sub-outcome
Strategic objectives
Purpose
SA’s national priorities advanced in bilateral engagements
To strengthen and consolidate SA’s political, economic and social relations through the outcomes of structured bilateral mechanisms and high-level engagements reflecting national priorities, the African Agenda and the Agenda of the South
To promote relations with foreign countries
MTEF allocation (R ’million)
2015/16
2016/17
2017/18

17. Programme 2: International Relations
Bilateral engagements are the basis for strengthening political and economic relations and provide the platform to advance national priorities and to lobby for support for multilateral engagements and common positions
The performance indicator on political work is predicated on the implementation of Structured Bilateral Mechanisms (BNCs, JCCs, JNCs and others) and reciprocal High-Level visits
The performance indicator on economic diplomacy measures the work that missions undertake to increase value added exports; attract Foreign Direct Investment to priority sectors (NGP and IPAP); promote tourism; promote the removal of non tariff barriers through:
Hosting or participating in trade seminars and tourism promotion,
Engagements with chambers of commerce, high level investors, relevant government ministries

18. Programme 2 Key Result Area Annual target MTEF Target
Political engagements through structured bilateral mechanisms and high level engagements
34 BNC
58 high-level engagements
102 BNC
174 high-level engagements
Economic diplomacy initiatives
112 trade and investment seminars
336 trade and investment seminars
126 engagements with Chambers of commerce
378 engagements with Chambers of commerce
64 engagements with targeted government ministries
192 engagements with targeted government ministries
86 high-level potential investors
258 high-level potential investors
67 tourism promotion events
201 tourism promotion events

19. Programme 3: International Cooperation
MTSF sub-outcome
Strategic objectives
Purpose
An equitable and just System of Global Governance
To enhance international responsiveness to the needs of developing countries and Africa through negotiations and influencing processes in the Global Governance System towards a reformed, strengthened and equitable rules-based multilateral system
Participate in international organisations and institutions in line with SA’s national values and foreign policy objectives
MTEF allocation (R ’million)
2015/16
2016/17
2017/18

20. Programme 3: International Cooperation Sub-programme 3
Programme 3: International Cooperation Sub-programme 3.1: Global Governance
South Africa is committed to multilateralism and a rules-based international order and to this end participates and plays an active role in all for a of the United Nations system and its specialised agencies, funds and programmes
With particular focus on peace and security, sustainable development (social, economic and environmental) protection and promotion of human rights and humanitarian affairs, international crime and international law
Advocate for UNSC reform to curb unilateral actions taken outside the United Nation’s peace and security mechanisms in various regions

21. Programme 3: International Cooperation Sub-programme 3
Programme 3: International Cooperation Sub-programme 3.1: Global Governance
Ensure South Africa’s compliance with international law –
the provision of legal advise and opinions on issues relating to international law, e.g. extending the continental shelf to significantly increase South Africa’s territory, International Criminal Court, International Court of Justice, Law of the Sea etc

22. Sub-programme 3.2: Continental & Regional Cooperation
MTSF sub-outcome
Strategic objectives
Purpose
An economically integrated Southern Africa;
Political cohesion within Southern Africa to ensure a peaceful, secure and stable Southern African region;
A Peaceful, secure and stable Africa;
A sustainable developed and economically integrated Africa
To enhance the African Agenda
To strengthen political and economic integration and development of SADC
To participate and play active role in continental and regional structures to contribute and enhance efforts for sustainable development and peace and security
MTEF allocation (R ’million)
2015/16
2016/17
2017/18

23. Sub -programme 3.2 Continental & Regional Cooperation
South Africa will align its foreign policy engagements with Africa’s Vision 2063 to contribute to the socio-economic development of the African continent.
South Africa will continue to focus on implementation of the continental integration agenda, regional economic integration and finding African Solutions to African problems through:
Strengthening the AU and its structures
Contribution towards entrenchment of democracy (election observations)
Participating in peace missions, and (Peace, Conflict, Reconstruction and Development (PCRD) initiatives
Promotion of Good Governance (APRM) & protection of Human Rights
Contributing to Socio-economic development ( implementation of the New Partnership for Africa’s Development (NEPAD)

24. Sub-programmes 3.3 & 3.4 South-South & North South Cooperation
MTSF sub-outcome
Strategic objectives
Purpose
Strong, mutually beneficial South-South cooperation & Beneficial relations with strategic formations of the North
To strengthen and consolidate South-South relations by utilising membership and engagements with groupings of the South to advance South Africa’s foreign policy To advance and leverage national priorities, the African Agenda, and the Development Agenda of the South with the formations of the North
To pursue cooperation among countries and groupings of the South and the development of common positions on political, economic, social and human rights issues and to harness emerging collective political and economic influence of countries of the South in pursuit of the Development Agenda.
To pursue a developmental agenda approach with strategic formations of the North
Focus: BRICS; IBSA; EU; TICAD
MTEF allocation (R ’million)
2015/16
2016/17
2017/18

25. Programme 3 Key Result Areas Annual Target MTEF Target
Multilateral structures and process engaged in to enhance the responsiveness of the multilateral system to SA’s needs and needs of developing countries
21 multilateral meetings
100% approved requests for humanitarian assistance disbursed
100% of Legal Services rendered
80% resolutions, decisions, outcomes reflecting SA’s national interests
AU structures and process
Six AU structures
Two PAP sessions
Two APRM Summits
16 AU structures
Six PAP sessions
Six APRM Summits
100% election observer Missions
SADC structures and process
11 SADC structures
33 SADC structures

26. Programme 3 Key Result Areas Annual Target MTEF Target South –South
2 strategies
18 meetings and processes of organisations of the South
Five strategies for SA’s engagement with identified formations
56 meetings and processes of organisations of the South
North -South
Eight meetings and processes of formations of the North
24 meetings and processes of formations of the North

27. Programme 4 Sub-programme 4.1: Public Diplomacy
Strategic objectives
Purpose
Focus
To create a better understanding and awareness of South Africa’s foreign policy through targeted public diplomacy partnerships and platforms
Advance a positive projection of South Africa’s image through communication strategies on South Africa’s foreign policy positions and programmes nationally and internationally
Media briefings, statements and opinion pieces
Publications (Statutory publications as well as internal electronic publications
Public participation programmes (PPP)
MTEF allocation (R ’million)
2015/16
2016/17
2017/18

28. Programme 4 Sub-programme 4.2: State Protocol
Strategic objectives
Purpose
Focus
To provide professional State Protocol services through the facilitation of state events, visits and diplomatic accreditation
Provide a professional State Protocol service to heads of state and government and designated dignitaries and render advisory services to various stakeholders
Protocol services for state and ceremonial events, incoming and outgoing state visits
Immunities and privileges provided for the Diplomatic Corps

29. Programme 4 Key Result area Annual target MTEF target
Media briefings, media statements, public participation programmes (PPP), publications
18 Media briefings
160 media statements
12 PPPs
67 publications
54 Media briefings
480 media statements
36 PPPs
201 publications
Protocol Services & diplomatic immunities and privileges, diplomatic passports and appointment of foreign and SA heads of mission
100% as per request

30. Vote Expenditure as at 31 March 2015
PROGRAMMES
FINAL APPOPRIATION
R’000
EXPENDITURE
VARIANCE
%SPENT
ADMINISTRATION
87%
INTERNATIONAL RELATIONS
102%
INTERNATIONAL COOPERATION
43 877
91%
PUBLIC DIPLOMAC&PROTCOL SERVICES
34 544
89%
INTERNATIONAL TRANSFERS
105%
TOTAL
97%

31. Vote Expenditure as at 31 March 2015
STANDARD ITEMS
FINAL APPOPRIATION
R’000
EXPENDITURE
VARIANCE
%SPENT
COMPENSATION OF EMPLOYEES
105%
GOODS AND SERVICES
91%
INTEREST AND RENT ON LAND
46 586
100%
TRANSFERS AND SUBSIDIES
PUR/CONST CAPITAL ASSETS
58%
PAYMENTS
97%

32. 2014/15 Expenditure Preliminary Outcome
Programme 1: Administration
The expenditure for the Programme was R1.239 billion (87% spending). The underspending is as a result of delays in capital projects due to unforeseen and unavoidable circumstances.
Programme 2: International Relations
The programme reported an expenditure of R3.106 billion. The overspending is as a result of depreciation of the Rand against other major currency. As a consequence the expenditure for programme 2 has exceeded the budget by R58 million.
Programme 3: International Cooperation
The expenditure for the programme was R460 million. The underspending is as a result of the office accommodation for PAP that has not be concluded.

33. 2014/15 Expenditure Preliminary Outcome
Programme 4: Public Diplomacy and Protocol
The underspending of R35 million is as a result of unclaimed funds by partner department for the Presidential Inauguration activities.
Programme 5: International Transfers
The overspending is as a results of foreign exchange rates losses in relations to the payment of membership fees and assessed contributions to United Nations, African Union and South African development Community.

34. 2015 Budget allocation per programme
Programmes
2015/16
2016/17
2017/18
2014/15 – 2017/18
MTEF
Average annual growth
% of expenditure
R ‘000 %
Administration
2.4%
24.1%
International Relations
2.6%
51.1%
International Cooperation
1.8%
8.0%
Public Diplomacy
-4.3%
4.5%
International Transfers
3.7%
12.3%
Total
2.3%
100.0%

35. 2014 Budget allocation per Economic Classification
Econ. Classification
2014/15 OUTCOME
2015/16
2016/17
2017/18
MTEF
% OF 2015 BUDGET
R ‘000
Compensation of Employees
43.4%
Goods and Services
39.5%
Transfers and Subsidies
12.4%
Payments for Capital
4.7%
Total
100.0%

36. 2014 ACTUAL EXP. & 2015 MTEF ALLOCATIONS

37. 2015 MTEF Baseline assessment
2015/16
2016/17
2017/18
Approved baseline
Compensation of employees
RSA salaries
1,218,236
1,285,239
1,362,354
Foreign allowance
671,821
694,551
744,497
Locally Recruited Personnel Salaries and benefits
636,156
645,099
677,354
Compulsory goods and services
Transfers and Subsidies
Capital Expenditure: Building
Recapitalisation
96 831
Operational expenditure
Total Allocated

38. 2015 MTEF Compulsory Goods & Services
2015/16
2016/17
2017/18
a)Lease payments
898,858
1,036,332
1,099,727
b)- Schooling fees
89,648
96,457
99,878
c)-Special Travelling Privileges
42,890
48,799
57,230
d)- PPP payments
210,640
221,061
236,834
e)- Municipality fees
85,998
88,560
95,173
f)- Computer services ( Bandwidth)
130,816
124,622
105,800
g)-Security contracts at missions
28,353
36,915
39,800
h)- Medical services
28,500
32,300
37,468
i)- Municipal charges for diplomatic missions in South Africa
28,900
32,400
37,900
j)-Transfer costs including insurance
94,303
l)-Other Computer services(Transversal systems and applications)
106,136
118,500
125,680

39. African Renaissance and International Cooperation Fund

40. STRUCTURE OF THE PRESENTATION
Introduction
The utilisation
Programme performance plan
MTEF Allocation
Conclusion

41. 1. Introduction
The African Renaissance and International Co-operation Fund was established in terms of Section 2(1) of the African Renaissance and International Co-operation Fund Act, 2000 (Act No. 51 of 2000) and subject to direction of the Minister under the control of the Director-General (DG).

42. 2. The Utilisation Of Fund
The Minister must, in consultation with the Minister of Finance, establish an Advisory Committee consisting of the following members:
the Director-General or the delegate of the Director-General;
three officers of the Department appointed by the Minister; and
two officers of the Department of Finance appointed by the Minister of Finance.
The Advisory Committee must make recommendations to the Minister and the Minister of Finance on the disbursement of funds through loans or other financial assistance.

43. 2. The Utilisation Of Fund
Loans or other financial assistance are granted in accordance with an agreement entered into by the country in question and the Minister of International Relations and Cooperation (hereafter referred to as the Minister). Assistance granted is subject to such terms and conditions as may be agreed upon by that country and the Minister, acting in each case in consultation with the Minister of Finance.

44. 3. Programme Performance Indicators
STRATEGIC OBJECTIVE
OBJECTIVE STATEMENT
TARGET
To promote democracy and good governance
Support the holding of democratic elections in identified countries on the continent
100% of approved disbursement to support democracy and good governance processed timeously
To contribute to human resource development
Develop and provide identified training programmes
100% of approved disbursement to support capacity-building processed timeously
To support socio-economic development and integration
Support the implementation of socio- economic development and integration projects
100% of approved disbursement to support socio-economic development and integration processed timeously

45. 3. Programme Performance Indicators
STRATEGIC OBJECTIVE
OBJECTIVE STATEMENT
TARGET
To provide humanitarian assistance and disaster relief
Assist countries that are in need of humanitarian assistance and disaster relief
100% of approved disbursement for humanitarian assistance processed timeously
To support cooperation between South Africa and other countries
Implement bilateral and trilateral cooperation agreements
100% of approved disbursement for cooperation processed timeously
To contribute to PCRD
Support PCRD efforts on the continent
100% of approved disbursement for PCRD processed timeously

46. 4. MTEF Allocation 2015/16 R’000 2016/17 2017/18 Indicative baseline
Reduction
-1 619
Appropriated funds
96 831

47. 5. Conclusion During 2014/15 the Fund implemented the following:
Appointed full time secretariat for a period of six months as part of the transitional arrangements.
Adopted terms of reference for Advisory Committee as well as Secretariat.
The Accounting Officer appointed the audit and risk committees.
Developed an operational framework and adopted DIRCO policies and procedures relevant to ARF.

48. Thank you