NOMPU SIZIBA: The Department of Trade and Industry’s InvestSA will be embarking on an investment promotion trek on two continents between March 19 and 30. They are heading to India, Switzerland, Germany and France. The move is part of their mandate to promote the country’s reputation and in this instance they are selling the country to governments and businesses in those countries as an attractive business destination.
To tell us more, I am joined on the line by acting deputy director-general for InvestSA, Mr Yunus Hoosen. Thanks very much for joining us, Mr Hoosen. What is it about South Africa as an investment destination that you’ll be particularly punting in these countries, and are there certain sectors which you’ll be suggesting look right for investment?
YUNUS HOOSEN: Thank you, and good evening to your listeners. I think this venture is more important in terms of us enhancing the new dawn and, despite the challenges that South Africa has experienced, renouncing them, keeping the benefits of the new dawn in terms of government providing policy certainty.
This road show is in fact twofold. One part is in terms of the investment mobilisation drive. The other part is to provide enough data to investors in Europe, which is our largest investor, as well as in India – to give them an update on the policy initiatives and reforms that government has been putting in place over the last year, and particularly in the domain of the dti; how we’ve been working in terms of the equity-equivalent programme for the black empowerment programme; the localisation; the programme in terms of the industrialisation; and talking to them about the update on the intellectual property and the investment tag. So it’s more about engaging investors on their concerns and daily issues in South Africa that we can unblock to ignite the new growth path.
NOMPU SIZIBA: When you think about all the efforts that the dti has been making in the last number of years, how does it feel when you keep on seeing very low, lacklustre numbers in terms of the manufacturing data that we saw today, for example, for January – up 0.3%?
YUNUS HOOSEN: I think it’s very cyclical, and data changes quarter for quarter. But I think for us it is to keep up the momentum and keep up the drive, and make South Africa more conducive an environment for both domestic and international investors. Early this week we signed a collaborative agreement with the World Bank to include South Africa’s ease of doing business in the investment climate over the next two to three years.
So I think we have just got to stay on the peddle and make South Africa a more attractive investment destination.
NOMPU SIZIBA: In our engagement with, say, India vis-à-vis the European nations, are we looking for something different? India and South Africa have a strategic partnership relationship – are we looking for something different or just basic vanilla investment?
YUNUS HOOSEN: In the case of India I think we started off post-1994 with some very good investments like Tata, and a number of areas of Tata invested. Then there was a lull in terms of the investment relationship. Last year we had the first South Africa-India business summit, and we also signed an agreement with the InvestSA and Invest India. And we are now beginning to propel this relationship to new heights in a number of different sectors like the ICT sector, some areas of manufacturing and so forth. So India is beginning to reach out into the African continent and look to South Africa as a regional manufacturing or services hub.
In Europe – it’s been long-term traditional investors, but also investors looking at new opportunities and new expansions, but more enunciating the policy charity issues and providing certainty to investors, all in terms of government policy and the government regulatory environment.
NOMPU SIZIBA: Are we getting there in terms of the policy clarity, because that keeps on coming up? Yesterday we had the business confidence index from two. We’ve had that particular gauge from two different houses – the South African Chamber of Commerce and Industry and the Quarterly RMB one. Confidence is not going up; it’s going down. Yet we do see that President Cyril Ramaphosa, for example, is saying all the right things, but obviously it’s not being reflected in the company.
YUNUS HOOSEN: Look, from our perspective if we look at the latest report from the Institute of International Finance, South Africa in January attracted the largest share of finance capital in emerging markets. It was number one. Number two was India. And if you look at the Intel report for last year, prior to that South Africa attracted only $1.3 billion of investment. That increased last year to $7.3 billion. That’s a more than 440% increase.
So it shows that the work that the president, since he has taken office, has been able to move government for better confidence, but particularly in a number of areas – reform and providing certainty on the Mining Charter, sorting the IRP [Integrated resource Plan] in terms of the energy policy, and opening up the telecom sector. So investors see that there is movement. Investors take a long-term view, and this can give confidence in South Africa.
NOMPU SIZIBA: Mr Hoosen, we know that the dti does, in some instances, especially at the special economic zones, offer incentives for investment. How much of an impact have these had on getting investment in, and are you going to be selling these kind of initiatives on your trip?
YUNUS HOOSEN: Yes. I think we are announcing that special economic zones are attracting a number of investors across the board. We have 10 special economic zones and we are providing world-class infrastructure. These special economic zones themselves have been benchmarked. The Chinese government has even come to us and said this is one of the finest special economic programmes globally.
So, besides providing the world-class infrastructure, we are providing a fantastic package of incentive support for investors that want to come to South Africa to set up a base for the African continent or regional manufacturing hub. It provides a wonderful business case and incentive package for them.
NOMPU SIZIBA: Mr Hoosen, we’ve run out of time, but thank you very much and all the very best with that trip. I hope it’s a productive one.