MNN Hub
*This content is brought to you by SAIC
By Dr. Brett Lyndall*
Financial experts are bullish that the initial target of R1.2 trillion of pledged investment into the South African economy by 2023 will be met, even exceeded, at the 5th and final leg of the current investment drive of the South African Investment Conference (SAIC), due to take place at the Sandton Convention Centre in Gauteng on 13 April 2023.
This optimism stems from the fact that, since the launch of the investment drive in 2018, big strides have been made so far as the SAIC has managed to attract 95 per cent of the target set from both local and international investors, bringing the target firmly into sight this year.
The 5th annual SAIC will serve as a platform in terms of which South Africa (SA) and its representatives can:
Position the country as a globally relevant player and partner in trade and investment that can compete with the best in the world;
Showcase SA’s capabilities and its strategic importance in the region;
Profile the country’s economic recovery strategy and implementation;
Reinforce SA’s position as an attractive business, investment, and tourism destination;
Showcase investment opportunities that transform the economy and create employment opportunities;
Emphasise SA’s continued commitment towards zero tolerance for corruption in all sectors of society.
Progress
“Over the course of the last year, we have laid a firm foundation based on the commitments we made for faster growth through our investment drive, economic reforms, public employment programmes and an expanding infrastructure programme,” President Cyril Ramaphosa pointed out in his State of the Nation address earlier this year.
Indeed, since the inaugural SAIC conference in November 2018, steady progress has been made with the much-needed diversification of the economy.
At the inaugural SAIC session in November 2018, both local and international investors from 22 countries spread around the globe, responded to SA’s call, making investment announcements totalling nearly R300 billion.
At the second SAIC session in November 2019, investors once again affirmed South Africa as an attractive investment destination. Pledges by the likes of MTN (R50 billion over five years), naamsa (R6 billion), Legacy Group (R3 billion), Coca-Cola (R14.7 billion), Amdec Group (R14 billion), Anglo American (R72 billion), Exxaro (R20 billion) and Rio Tinto (R6.5 billion), among many others, securing billions more. This augured well for generating buy-in of the country’s investment requirements at the remaining three annual SAIC sessions.
At the hybrid physical/virtual event in March 2020, when COVID lockdowns restricted travel and large gatherings, investment pledges of R109.6 billion were unveiled, increasing the total value of commitments made since 2018 to R773.6 billion. At this event, the focus shifted from new investment pledges towards the delivery of existing commitments. It also concentrated on progress made in implementing policies to improve the investment environment.
At the 4th SAIC session in March 2022, investors once again affirmed South Africa as an attractive investment destination, by pledging R337 billion in investment.o R332 billion. With R1.14 trillion in investments
At the conclusion of the conference, a euphoric President Ramaphosa declared that the total level of investment pledged at the four Investment conferences totalled R1.14 trillion, a mere “R60bn short of our ambitious target of raising R1.4 trillion ($82.32bn) over a five-year period”, which culminates at next week’s SAIC.
According to SAIC, of the 152 investment announcements made to date, 45 projects have already been completed, while a further 57 projects are currently underway. Among others, these investments have resulted in new factories, call centres, solar power plants, undersea fibre optic cables, the expansion of production lines and the adoption of new technologies.
Besides increasing local production and encouraging efforts to buy local products, these investments continue to contribute to the country’s national goals of socio-economic development, sustainable job creation, poverty reduction and a more equal and just society.
Although SAIC 2023 takes place under severe energy-supply constraints, which have resulted in persistent load-shedding, the Government, through the Energy Action Plan, has announced several interventions to turn around the situation.
Besides appointing a Minister of Energy to facilitate the turnaround, since SAIC 2022, many more energy-conserving strategies and policies have been put in place. These include cooperation with the private sector to fast-track investment to clear the deficit of some 4 000 MW of energy supply, increasing the licensing threshold for embedded generation projects from 1 MW to 100 MW, launching a bid window of the Government’s Renewable Energy Independent Power Producer Procurement programme, which will add new generation capacity to the grid over the next two years, mainly through wind and solar power. Hopefully, these measures will assist in soothing investor concerns and encourage further investment.
Potential
South Africa’s rich potential in nearly every sector may further tip the scales in favour of investment at this year’s SAIC.
The country’s vibrant emerging market, a young and eager labour force, resilient population, abundant natural resources, an advanced financial and banking sector, world-class infrastructure and logistics, a flourishing tourism sector, a large presence of multinational corporations, favourable access to world markets, are but a few of South Africa’s investment drawcards.
A case in point is the enormous growth in tourism to SA post-COVID, despite the shock of the Ukrainian war. With a 147% spike in tourist arrivals in the first half of 2022, reaching an impressive 2,285,746 tourists, tourism to SA saw a tremendous bounce back and positive growth. At the same time, forward booking for this year was also on the rise.
The African Continental Free Trade Area (AfCFTA) is furthermore set to boost intra-Africa trade and travel, creating a market of over 1bn people with a combined GDP of over US$2 trillion. South Africa has several trade agreements that provide an export platform into global markets.
In conclusion: SA undoubtedly has everything it takes to be a winning nation. Backed by a formidable force of national and international investors, it is now up to us to optimise the country’s potential and conquer its weaknesses – in particular completely rooting out rampant corruption – thus delivering on our promise of solid returns to the investment community.
(Visited 76 times, 76 visits today)
Source: BizNews | Read More