President Cyril Ramaphosa is using the global stage to promote South Africa as an "investment destination of choice" to foreign and local investors alike.
The president on Monday delivered the opening address of the Financial Times Africa Summit in London. The summit is a gathering of investors, business people and key decision makers. In his address, Ramaphosa shared his views on the investment potential across the continent, and in SA particularly.
In order to attract foreign direct investment, Ramaphosa elaborated on the reforms being introduced to improve the ease of doing business in the country, among other things.
"Since last year we have been implementing key structural reforms to address perennially weak growth, ignite economic activity, restore investor confidence and create jobs," Ramaphosa said.
Steps have also been taken to introduce policy certainty in areas such as mining, oil and gas and telecoms, he said. This is all in an effort to create a "stable environment" for investment.
His remarks come ahead of the second South Africa Investment Summit to be held next month, as part of a drive to raise R1.2trn over five years. In its inaugural year, about R300bn in investment commitments were made. This year the focus will be to move beyond commitments and towards the implementation of "bankable projects," Ramaphosa said.
Here are seven key areas being addressed to encourage investment in SA:
SA is finalising the Integrated Resource Plan. It includes a "diversified portfolio" of technologies, such as lower-emission coal technologies, nuclear, hydropower, gas, renewables and battery storage, Ramaphosa said. The country's 102 renewable energy projects have so far attracted $14bn in private sector investment and created around 40 000 jobs, he added.
He also punted reforms at power utility, Eskom, which he described as "one of the greatest challenges" to the domestic economy. Eskom faces severe liquidity problems, huge debt and operational challenges.
"We have embarked on a process to strengthen governance, cut costs, improve revenue collection and increase energy availability and plant performance," he said.
The unbundling of the power utility into three entities – such as transmission, generation and distribution is key in the Eskom reform strategy, he explained.
Government has initiated the release of high-demand broadband spectrum. This aims to bring down data costs and encourage more investment, he said.
3. Immigration reform
Government is also focusing on attracting skilled professionals and growing tourism by prioritising immigration reform and introducing changes to the visa regime. This is also part of Finance Minister Tito Mboweni's economic reform plan – in which he proposed friendlier immigration regulations for foreigners with tertiary qualifications from accredited institutions, Fin24 previously reported.
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Government has also undertaken a process of accelerated land reform, based on recommendations from an expert panel he appointed. "They have presented a comprehensive package of measures to resolve what is not only one of the great injustices of our colonial and apartheid history, but is also an impediment to faster, more inclusive growth," Ramaphosa said.
He also assured processes will be in line with the Constitution and will not only safeguard property rights, but also ensure all people have "equal opportunity" to access these rights.
5. Industry development
There will also be a focus on developing industries with high growth potential. These industries include the automotive, clothing and textiles, gas, chemicals and plastics, renewable energy, oceans economy, agriculture and the high-tech industries, he said.
SA will expand trade and investment links with the Southern African region and the rest of the continent through the African Continental Free Trade Agreement. SA is the largest exporter of trucks to the rest of Africa, and the fourth largest exporter of cars, he said. These exports support about 250 000 jobs locally, he explained.
SA also most recently entered into a trad agreement with the UK and five other African countries to continue the current terms of trade, in the case of a no-deal Brexit.
"This agreement is important for the thousands of South African workers whose jobs are dependent on bilateral trade with Britain, and for the investors who have utilised South Africa as an export base to the UK and the rest of the world," Ramaphosa said.
Ramaphosa highlighted that the SA fiscus is under great pressure, but government is working to ensure debt sustainability, improve spending and reducing risks from contingent liabilities, especially from public enterprises. SA needs to pursue "prudent" fiscal policies with "sound" macro-economic management, he said.
During his address Ramaphosa also said that he meets with business leaders, labour and community leaders on a monthly basis to discuss economic reforms. He added that by acknowledging and addressing the challenges, SA would be well-positioned to take advantages on the opportunities in the African continent. He called on the investor community to take advantage of the reforms sweeping across the continent and to invest.
"There has never been a better time to invest in Africa," he said.