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RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSA #2666/01 3440541
ZNR UUUUU ZZH
R 090541Z DEC 08
FM AMEMBASSY PRETORIA
TO RUEHC/SECSTATE WASHDC 6671
RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE

UNCLAS SECTION 01 OF 03 PRETORIA 002666 
 
SENSITIVE BUT UNCLASSIFIED 
SIPDIS 
 
DEPT FOR EEB/CIP/KATHERINE TOWNSEND 
 
E.O. 12958: N/A 
TAGS: ECPS EIND EINV EINT ETTC SOCI TINT USTR SF CH
SUBJECT: CISCO ADDRESSES ICT SKILLS SHORTAGE IN SOUTH AFRICA ONE 
CLASS AT A TIME 
 
REF: PRETORIA 2665 
 
¶1. (SBU) Deputy Chief of Mission (DCM), Commercial Counselor, 
Economic Counselor and ICT Officer attended the graduation of the 
inaugural class of Cisco Global Talent Acceleration Program on 
November 28.  The DCM provided the key-note address at the 
graduation ceremony.  Cisco executives outlined the company's 
investments in South Africa, which included educational initiatives 
aimed at improving skills development through their Innovation Hub. 
They also raised concerns about unscrupulous Chinese commercial 
activities in the African ICT sector.  Embassy Officers offered 
advice on neutralizing the impact of Chinese activities. 
 
-------------------------------------------- 
CISCO GLOBAL TALENT ACCELERATION PROGRAM 
FACILITY TO SERVE AS A FOUNDATION FOR 
ICT SKILLS DEVELOPMENT IN SUB-SAHARAN AFRICA 
-------------------------------------------- 
 
¶2. (U) Cisco celebrated the graduation of its inaugural class of 
Global Talent Acceleration Program (G-TAP) students in Johannesburg 
on November 28.  The DCM provided the keynote address and 
congratulated the 14 graduates for their achievements and challenged 
them to utilize their skills to positively impact their communities 
and nation.  Cisco G-TAP Program Director John Livingstone also 
addressed the graduates and explained that the South African program 
is only one of three training academies of its type in the 
developing world.  The Gauteng facility (launched in January 2008) 
was the second G-TAP initiative to be launched in emerging 
economies, following the establishment of a facility in Amman, 
Jordan last year.  A third center has since been launched in 
Bangalore, India with addition facilities slated for China and Latin 
America. 
 
¶3. (U) Cisco selected South Africa as the launch pad for its G-TAP 
in Sub-Saharan Africa to support emerging African governments and 
organizations in addressing ICT skills shortages.  These skills are 
crucial to helping SA's economy grow.  Developing countries lag in 
broadband ICT adoption.  Research shows ICT and broadband adoption 
can have a positive and measurable effect on gross domestic product 
of two to three percent.  G-TAP is a long-term Cisco initiative 
aimed at developing next-generation local network consulting 
engineers (NCEs) for the company and its clients.  Recruits for the 
first class were geographically diverse and the overwhelming 
majority of trainees were from historically disadvantaged groups. 
 
¶4. (U) The initial focus of the Gauteng G-TAP facility was on South 
Africa where Cisco aims to employ and train South African-based 
recruits at the professional and associate levels.  Selected 
trainees participated in a rigorous program that combined theory, 
industry exposure and hands-on experience. These trainees received a 
salary and underwent training in small groups.  This enabled G-TAP 
to put a strong emphasis on technical and professional training and 
mentorship, as well as on-the-job training in North Carolina.  The 
majority of the graduates are expected to be absorbed by Cisco.  The 
remaining graduates should be offered employment with a Cisco 
partner company. 
 
¶5. (U) Cisco executives hope to expand the reach of the South 
African G-TAP facility in three directions within the next twelve to 
eighteen months.  Initially, a professional track will be added to 
attract students with three to five years' work experience.  Next, 
Cisco partners will have the opportunity to enroll their own 
employees in G-TAP.  Finally, students will be recruited to the 
Qemployees in G-TAP.  Finally, students will be recruited to the 
Johannesburg facility from a range of countries in emerging Africa, 
effectively positioning South Africa as a technology leader in the 
region. 
 
¶6. (U) The entire Sub-Saharan African region is experiencing 
tremendous growth in ICT, but skills shortages are reducing the full 
economic impact of the boom.  Instead of importing talent from other 
regions on a temporary basis, G-TAP helps Cisco to provide customers 
with a long-term solution in the form of a highly-skilled and 
well-trained local work force. Cisco executives plan on recruiting 
talent from the Southern Africa Development Community (SADC) next 
year.  They cited Namibia and Angola as the countries in the region 
with the most potential for ICT growth.  In the longer term, they 
would also like to develop talent from Nigeria.  The skills that 
G-TAP provides to its graduates contribute to the development of the 
local knowledge base and infrastructures that are critical for 
accelerating and sustaining economic growth. 
 
------------------------------------ 
OTHER SKILLS DEVELOPMENT INITIATIVES 
------------------------------------ 
 
¶7. (U) Cisco announced a R215 million ($21.2 million) investment for 
its Innovation Hub Technology Center in September.  A series of 
programs coordinated through the hub are expected to drive R1 
 
PRETORIA 00002666  002 OF 003 
 
 
billion ($100 million) in gross domestic product growth over five 
years.  The Innovation Hub Technology Center will host ICT 
initiatives including an Innovation Lab, the G-TAP, the Cisco 
NetVarsity, an Entrepreneur Institute, and a Software Development 
Program.  The Innovation Hub Technology Center is expected to create 
a minimum of 200 direct and 800 indirect employment opportunities. 
This includes the advancement of intellectual property rights 
expertise, the development of design and network engineers, local 
software development, state-of-the-art networking communications 
laboratories, access to business guidance, and a showcase for 
venture capital providers looking to fund solutions or businesses 
incubated in the hub.  Cisco hopes these initiatives will cultivate 
entrepreneurial awareness and develop technical skills in South 
Africa. 
 
---------------------------------- 
SOUTH AFRICAN ICT BUSINESS CLIMATE 
---------------------------------- 
 
¶8. (SBU) In response to Embassy queries about the business climate, 
Cisco executives noted a positive change in the tone of their 
relationship with the South African government and 
government-controlled Telkom after the recent change in government. 
(Note: President Mbeki was ousted following in a change of 
leadership in the African National Congress in September 2008.) 
However, they also observed delays in the business decision-making 
cycle at all levels of government in anticipation of the spring 2009 
general election and expected transition in the national leadership. 
 They cited the drawn-out legal battle between the Department of 
Communications and ICT company Altech regarding new network licenses 
as slowing down ICT liberalization (Reftel) in South Africa.  They 
are also noticed inflation in the costs of licenses for new 
entrants. 
 
¶9. (SBU) Cisco executives added that they had reached a significant 
breakthrough in their relations with Telkom after two to three years 
of difficult negotiations.  Cisco recently signed a Memorandum of 
Understanding with Telkom and Telkom officials are beginning to 
realize that they will need Cisco assistance to become more 
competitive in an increasingly competitive ITC market.  Telkom CEO 
Ruben September directly calls Cisco counterparts now when he used 
to fail to respond to their calls.  According to Cisco executives, 
Telkom has already wasted time in transitioning to a more 
liberalized ICT market due to bureaucratic inefficiencies.  Now that 
Telkom is facing stiff competition with the end of its monopoly 
regime, September has acknowledged that the company will "need 
support to transition to a real-world, market-based system." 
 
------------------------- 
CONCERN REGARDING CHINESE 
BUSINESS PRACTICES 
------------------------- 
 
¶10. (SBU) Cisco executives expressed concern regarding unscrupulous 
Chinese business practices in the Southern African ICT market.  The 
said the Chinese competitors employed "strange tactics and 
behaviors" that could undermine Cisco's investments in the region. 
For example, public sector officials are "being flown first-class to 
China and wined and dined."  Executives also noted that the Chinese 
government has announced a desire to match U.S. trade with South 
Africa and to open a network center to promote this goal.  Cisco 
executives are not worried about raising capital for their 
initiatives in South Africa.  However, they are worried that the 
Chinese "advocacy" activities might influence South African 
government decision-making. 
Qgovernment decision-making. 
 
¶11. (SBU) The DCM encouraged Cisco executives to work with the U.S. 
Mission to promote their positive contributions to the South African 
ICT sector.  The Economic Counselor expressed an intent to compile 
information on the positive corporate social responsibility 
initiatives being implemented by U.S. ITC companies to assist with 
advocacy efforts.  The Commercial Counselor suggested that the USG 
could also organize orientation visits for South African officials 
to the U.S.  In addition, the USG could offer to host conferences or 
provide other technical assistance. 
 
¶12. (SBU) Comment.  South Africa is on the brink of an ICT broadband 
revolution in the next year or two with the introduction of 
market-based competition and increased infrastructure investment. 
However, high unemployment rates, lack of access to technology, and 
a lack of qualified local ICT professionals have thwarted efforts to 
fully realize the benefits of improved efficiency and productivity 
that usually accompany ICT adoption.  Initiatives launched by Cisco 
and other U.S. ICT companies to develop entrepreneurial and 
technical skills would begin to address the dual problems of high 
unemployment and skills deficiencies, one of the major constraints 
to economic growth in the country.  These initiatives would also 
help to alleviate the high levels of social and economic 
inequalities by providing training and employment opportunities to 
 
PRETORIA 00002666  003 OF 003 
 
 
historically disadvantage groups.  End Comment. 
 
BOST