Johannesburg-The year 2018 was a turning point for this country’s position on the world investment stage. The talk shops came to an end and dedicated government personnel put themselves on the front line to change the narrative about investment into South Africa.
The country wanted the world to know that their investments are sustainable and that the investments will grow.
The government put together a team of specially appointed investment envoys, private and public stakeholders, and partners from around the world to achieve a long-term goal that many would consider impossible. Thanks to the continued efforts of this country, Africa, and the world, it seems much less impossible as more and more strides are made.
A cornerstone of South Africa’s drive for economic growth has been its partnership with China over the last two decades. China’s diplomatic relations with South Africa over the past 20 years have seen China become South Africa’s largest trading partner, and South Africa become China’s largest African trading partner.
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Two-way trade volume has grown more than twentyfold, and direct investment from China has totalled more than $25-billion.
As part of Brazil, Russia, India, China, and South Africa (BRICS), South Africa and China have deepened cooperation around economic and technological development, as well as increasing the quality of life and prosperity for BRICS member nations.
South Africa is defining itself as an investment-friendly environment and it is evident in the increased engagement with global investors.
Among the leading investors in South Africa is tech giant Huawei, whose business presence and user base in South Africa has brought with it considerable technology transfer. Electronics giant Hisense recently reaffirmed its confidence in South African
with a $5-billion investment in new factory capacity in the country.
South African companies such as media giant Naspers and insurance players Discovery and Old Mutual have further strengthened investment and economic ties between the two countries. Naspers’ 28.9% stake held in Tencent, as well as Old Mutual’s partnership with China Energy Investment Corporation and Discovery’s 25% stake in Ping An Insurance are among the investments that bind South African and Chinese business together.
While I am not one who believes in a constant showcase of this investment drive’s achievements, I do know that the work is finally beginning to speak for itself.
South Africa has often been overlooked and undervalued due to policy change over the last several years that detracts from sentiment and confidence.
To unlock investment, we’ve been working on fixing these key policy issues. In our efforts to directly engage with investors, it is always a triumph when we are able to change those preconceived notions about our country and we have been successful in securing investment.
We should celebrate that more investors are looking at South Africa as a country that has formal and transparent processes, which function well within the rule of law, and that our institutions are able to mediate conflicts in society.
The government’s economic response and aid to Covid-19 was swift, thorough and prioritized the wellbeing of its citizens above all else.
Our next focus, as the government and as investment drivers, is looking at what a post-Covid economy looks like.
South Africa’s Economic Reconstruction and Recovery Plan outlined by President Cyril Ramaphosa contains the guidelines and immediate action government will take for an economic rebound.
It encompasses the work of the government and the Presidential Economic Advisory Council, and the National Economic Development and Labour Council (Nedlac). Nedlac aims to promote cooperation between government, business and community stakeholders in
solving South Africa’s socio-economic challenges.
We will play a major role in ensuring this because our renewed growth story will rely on investment in infrastructure, energy, telecommunications, ports and rail. These among other things are a priority intervention for economic recovery and will coincide with our R1-trillion investment goal.
Ramaphosa’s recovery plan outlines specific plans to revive the construction sector and to support the local manufacturing of inputs and other related sectors across the value chain, including the mining sector. The financing of the infrastructure of this scale will require that the government works with the private sector to deliver priority infrastructure projects.
At the Sustainable Infrastructure Development Symposium last year, 276 catalytic projects worth R2.3-trillion were identified with a funding gap of R502-billion. Fifty infrastructure projects and 12 special projects were gazetted to be prioritized for immediate implementation, effectively enabling over R340-billion in new investments. Covid-19 has put pressure on the government to revitalize the economy tenfold and we are more than prepared to face this task. We are building a new economy in a different global landscape.
- Tobias is the chairperson of Brand South Africa
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