By Acting Cabinet spokesperson Phumla Williams
If South Africa is not part of your long-term investment strategy your business runs the risk of being left behind. The country is open for business and offers a sound investment destination for savvy investors.
This week government will share investment opportunities with top business leaders from across the globe at the World Economic Forum (WEF) Africa meeting in Cape Town. It is convened under the theme: “Then and Now: Reimagining Africa’s Future.”
President Jacob Zuma will lead South Africa’s participation and will be accompanied by a team of ministers who will profile the country to prospective investors.
South Africa has consistently showed itself to be a dynamic and stable economy. Since the start of our democracy we have painstakingly put in place solid economic fundamentals.
Solid foundations
Our prudent fiscal management and monetary policies have given rise to macroeconomic stability, which has allowed the economy to remain robust in the global downturn when others have buckled.
Importantly, our stable democracy offers certainty and the environment for businesses to grow. Last year the country successfully held its fifth democratic national elections which coincided with our celebration of 20 Years of Freedom.
Investors are supported by our sound financial system and highly regulated banking sector. The banking sector remains robust, liquid and managed by the South African Reserve Bank and the National Treasury.
Apart from our strong fundamentals, we offers access to new markets. Investors can benefit from our intrinsic link with Africa, which is now one of the fastest growing regions in the world.
According to a recent report by the Organisation for Economic Co-operation and Development, Africa’s overall economy is expected to grow to 4.5 percent this year and by 5 percent next year.
South Africa offers investors the stability of a developed country along with the lucrative opportunities of a vibrant emerging market.
Future growth will be spurred on by the recently adopted Agenda 2063 which will drive the social, economic and political rejuvenation on the continent.
It envisions that in 50 years Africa will be a world leader, setting the standard for inclusive economic development, democratic governance and a just social order.
South Africa is the most diversified economy on the continent and plays an integral role in Africa’s advancement. Our country is also in a great location for growing your business in other parts of the African continent.
The government is encouraging local businesses to expand into Africa to support continental growth by relaxing cross-border financial regulations and tax requirements.
Similar support measures will also apply to foreign companies wanting to invest in African countries using South Africa as their regional headquarters.
Moreover, South Africa offers the stability of a developed country along with the lucrative opportunities of a vibrant emerging market.
Over the last five years the country accounted for the bulk of new investment projects in Africa from the United States, European Union countries, China and India.
The 2014 AT Kearney Foreign Direct Confidence Index ranked South Africa 13 among 25 leading economies moving us up two places from 2013.
Placed higher
This achievement should be seen against the fact that South Africa was placed higher than Switzerland, Sweden and the Netherlands.
Last year we had attracted R62 billion in investment inflows ranking us high among the BRICS (Brazil, Russia, India, China and South Africa grouping) countries in attracting foreign investment.
Foreign direct investment contributes significantly to our national goals of socio-economic development by creating sustainable jobs and the opportunity for skills development and training.
Our attractiveness as an investment destination is no accident. It can be traced to interventions such as the National Development Plan, New Growth Path and the Industrial Policy Action Plan.
Through the New Growth Path we are boosting performance in the six job drivers, namely mining, agriculture, tourism, infrastructure development, the green economy and manufacturing.
Government declared the economy an apex priority and new areas of growth such as the oceans economy, the green economy and shale gas exploration have been opened.
The ocean economy is bursting with potential, which is fast-tracked through Operation Phakisa in the areas of marine aquaculture, marine transport, offshore oil and gas exploration, and marine protection.
Geared for growth
The ocean economy has the potential to contribute up to R177 billion to gross domestic product and create an estimated 1 million jobs by 2033.
In supporting investors there is a new framework for Special Economic Zones that allows for targeted incentives, logistics improvements and active partnerships between businesses, municipalities and development agencies.
South Africa is also investing heavily in infrastructure such as electricity, transport, water, roads, schools and hospitals to build a platform for faster, more inclusive economic growth.
Over the next three years, the government would have invested more than R840 billion in infrastructure. These infrastructure plans present opportunities for both local and international investors to partner with government and take the South African economy forward.
The government is aware of the challenges to the economy and is addressing them through the implementation of the National Development Plan.
Our key constraints are also being addressed through the Nine-Point Plan unveiled by President Zuma as part of a major push to ignite economic growth and jobs growth.
We have created a vibrant environment for investment and businesses to flourish in this country. This is a profitable place to invest so make sure you next investment is South Africa.
