Minister in the Presidency, Khumbudzo Ntshaveni, has reiterated government’s stance that “there are no investors leaving" the country in droves.
This as some media reports stated earlier this month that Shell is leaving South Africa after operating in the country for over 100 years.
The minister was speaking on the sidelines of the Presidential District Development Model (DDM) Imbizo held at Kuruman in the Northern Cape on Thursday.
“There are no investors that are leaving the country in droves. You are dealing with commercial transactions which companies look at. One company comes out, another one comes in.
“[There was] a story that VW was leaving South Africa. VW just reinvested R4 billion preparing for a new line of auto-manufacturing vehicles that are coming in 2027 to 2029. So, it’s commercial transactions that happen globally.
"Every business looks at their own opportunities and says what’s in their own interest and it doesn’t mean it’s a reflection on the investor confidence in the country,” she said.
The minister said investments “continue to flow into this country” – citing the Boegoebaai green hydrogen project as an example.
“I could churn out the numbers that are invested. The President has mentioned Boegoebaai. There are international investors that have partnered with us on Boegoebaai and there are South African companies themselves.
“What’s important is when your own businesses invest in your own country – that’s most significant than anything else because it shows the international community that we have confidence,” she said.
In the State of the Nation Address (SONA) earlier this year, President Cyril Ramaphosa highlighted that green hydrogen and electric vehicle manufacturing are receiving particular attention.
“We are going to set up a Special Economic Zone in the Boegoebaai port to drive investment in green energy. There is a great deal of interest from the private sector to participate in the boom that will be generated from green hydrogen energy projects,” the President said at the time.
Load shedding and logistics
Addressing the challenge of load shedding and the issues in freight rail to businesses, Ntshavheni said government is steadily working on those challenges.
“Three months ago, the media was saying load shedding is making sure that investors leave but we have handled load shedding up to where we are [more than a month without load shedding].
“There are notions that we are burning diesel. We are not burning diesel. Eskom has told us that they are switching off some [generating units]. They are putting some in maintenance early because we’ve got excess power.
“We have been dealing with the logistics issue with Transnet in Durban in particular and they are back on speed in terms of the backlog that they faced. So, there is no lack of investor confidence in our country.
“In terms of the World Bank, we are still rated the largest economy in Africa…and we compete with other countries toe to toe in terms of attracting investments,” Ntshavheni concluded.
Automotive milestone
In his weekly newsletter, president Cyril Ramaphosa says the growth of South Africa’s automotive sector is a demonstration of “the potential of South Africa as an investment destination”.
The president said 2023 was a milestone year for South Africa’s automotive sector with the sixth millionth South African built vehicle exported with new vehicle exports reaching nearly 400 000.
“These figures are significant for a number of reasons. They show that our auto sector continues to grow despite a gloomy global economic outlook and disruptions to the flow of goods between countries."
According to the president, a recent report by PricewaterhouseCoopers (PwC) has found that net foreign direct investment (FDI) into South Africa has been consistently positive since the global financial crisis of 2007 to 2009 – meaning more investment has come into the country than out.
“Last year, FDI inflows amounted to R96.5 billion, equivalent to 1.4 percent of our Gross Domestic Product (GDP). This supports a trend where foreign direct investment has, on average, been far greater over the last five years than over the previous decade.
“The PwC report notes that South Africa has attractive fundamentals, such as world-class financial services and communications industries, deep capital markets, abundant natural resources and a transparent legal system. Furthermore, South Africa is ‘a strategic geographical location for entry into the rest of sub-Saharan Africa’,” he said.
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