South Africa’s flagship event “South Africa Investment Conference” will begin tomorrow (5th November) and will continue till 7th of November. It is designed to send a clear message that South Africa, despite its recent woes and worries, is still an attractive place for doing business not only among Africa nations but also globally. South Africa will showcase the good rating given by World Economic Forum in terms of its competiveness and reasonably good ranking given by the World Bank in the pecking order of ease of doing business.
This year’s conference will be attended by a range of business interests including mining, forestry, manufacturing, telecommunications, transport, energy, agro-processing, consumer goods, pharmaceuticals, infrastructure, financial services, energy, ICT and water. During the last year, the conference generated an investment commitment of R300 billion. This year around, it is expected that the promise to invest would be more than the previous year, despite the fact that the South African economy is going through a difficult trajectory.
The present dispensation is determined to carry the flag forward and believes that the current phase of economic challenges are temporary and the proactive steps being taken by the government would mitigate the hardships in the coming months. However, the rating agencies remain stubborn about the present state and according to them in the near future there is less possibility of the economy leaping given the fact that the structural reforms being contemplated would take time to bear fruits. Also, they point out that since the trade unions are against most of the reforms, particularly unbundling of power sector, cobbling up a reform path will be politically difficult for the country, which suffered immensely on account of the wide spread corruption by the earlier dispensation.
Not to be side-tracked by the flip side of the growth process, the government circles are quite upbeat about the reform process.
Through Invest SA, the nation proposes to bring close to US$ 1.2 trillion as investment by 2023. It may look a tall order, going by the present trend, but the government sources insist that it is achievable, with the scale of reforms being undertaken. For instance, the government has introduced a number of measures over the last 12 months: such as more investment into the digital economy and telecoms sectors by issuing a policy directive for the release of high demand spectrum. Also, the financial costs of doing business would be reduced through lowering of port and rail tariffs. The Mining Charter and the draft Petroleum Resources Development Bill, which will guide development in the country’s oil and gas sector, will soon be tabled in Cabinet for approval. Also, the government is embarking a plan to bring the best skills to the country by encouraging professionals to relocate their bases.
The government is setting aside R100 billion over 10 years for a National Infrastructure Fund and will be working with private investors and international financial institutions to leverage further finance for infrastructure. The newly launched African Continental Free Trade Area (AfCFTA), would be another window for global majors to set up their operations in South Africa to market goods and services to over 1.3 billion people in 54 African countries.
