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President Cyril Ramaphosa has welcomed the launch of South Africa’s third annual investment conference and the much needed capital potential in the country’s economy.
In his weekly open letter, Ramaphosa said that beyond its contribution to national GDP, investment stimulates and supports the growth of local economies, with direct material benefits for South Africans.
“It creates job opportunities and full-time jobs, providing people with an income to feed their families and pay for basic services. This income gives them purchasing power and allows them to access credit to buy a house or start a business, ”he said.
In previous years, more than 1,500 delegates attended South African investment conferences. But this year, to allow for social distancing, Ramaphosa said he expects about 175 delegates from listed companies, start-ups and entrepreneurs, business, labor and government associations to attend in person.
To date, an additional 1,000 delegates have registered online from different parts of the world, he said.
“The conference will demonstrate that South Africa remains an attractive investment destination and show the progress we are making in improving the business climate,” he said.
“It will build on the positive momentum of investment in the years leading up to the start of the Covid pandemic. Foreign direct investment flows to South Africa, for example, increased dramatically from R26.8 billion in 2017 to R70.6 billion in 2018. “
Over the past 10 months, Ramaphosa said the pandemic forced a reduction or suspension of many promising investments promised at previous conferences.
But these investments only represent about a tenth of the total investment commitment of R664 billion, he said.
“Most of the investments are being made. Of the 102 projects that were announced at the last two investment conferences, 12 are in the early stages of implementation, 19 have been launched and 44 are currently under construction or in implementation.
Reasons to invest
Ramaphosa said investor sentiment has been boosted by the implementation of structural reforms and the completion of industry master plans in sectors such as apparel and textiles, sugar and the auto industry.
“We will show our strengths as a country and how they can be used to attract new investment,” he said.
“For example, South Africa has been voted the second most attractive location for business process outsourcing for the third year in a row.
“As business continuity has been disrupted by the pandemic, we are in a perfect position to capitalize on the growing need for remote contact center companies.”
Ramaphosa said other reasons investors should look to the country include:
- South Africa is positioning itself as a hub for digital services. Following Amazon Web Services’ commitment at last year’s investment conference, the company opened its first cloud data center in Africa, in Cape Town, earlier this year.
- The country is already a preferred energy investment destination. Many of the projects implemented through the Renewable Energy Independent Power Producer Acquisition Program have been successful and have set an example for many countries around the world.
- With the start of the African Continental Free Trade Area (AfCFTA) in January, the country wanted to attract more continental investors and, at the same time, expand its own investments and the market for its goods and services in other parts of the continent. “Already, more than a quarter of South Africa’s exports go to other countries in Africa. We expect this to increase as the AfCFTA establishes a continental market of around 1.3 billion people and a combined GDP of around $ 2.3 trillion, ”Ramaphosa said.
Ramaphosa acknowledged that South Africa is not the only country trying to attract investment as part of its post-Covid-19 economic recovery efforts. This makes our task that much more difficult, he said.
“To achieve our goal, we have to work together as government, companies, workers and the whole of society to ensure that the seeds of local and international investment fall on fertile soil.
“Our national goal is that the investments we make at the third South African Investment Conference should create more jobs and better standards of living, and ultimately build the road to a better and more inclusive future for all.”
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