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Opportunity Issue 101

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INVESTMENT Our

INVESTMENT Our state-owned enterprises have been a huge drain on the fiscus over the years. Our reform process is aimed at bringing this to an end. Like many other countries, we are transforming our entire approach to state-owned companies so that they are better able to fulfil their vital social and economic functions. We have revised our Critical Skills List, which will enable us to attract skilled professionals to work and do business in South Africa. It is our ambition to be an economy and a society that is open to global skills, that attracts talent, expertise and innovation. We are establishing a special unit in the Presidency to deal with bureaucratic red tape and to improve the operating environment for businesses and to reduce the cost of doing business. These reforms are not insignificant. Nor are they superficial. These reforms are contributing to an economy that, despite the setbacks of the last two years, is developing and transforming. We see signs of this everywhere. We see this in Postmasburg, a small town in the Northern Cape, where the country’s largest concentrated solar powered plant is being built as part of our REIPPPP. We see it in the upgrades to the passenger terminal at Durban harbour, as part of a public-private partnership with Transnet. It can be seen at the Toyota plant in KwaZulu-Natal where the first hybrid vehicle produced in South Africa is being manufactured. It can be seen in Cape Town where the Nant SA vaccine manufacturing campus is being built. It can be seen in Gqeberha in the Eastern Cape where the largest pharmaceutical manufacturing site in Africa, owned by Aspen Pharmacare, is producing products for domestic consumption and export. These are all places where investment commitments are being realised, where plants are being built, where jobs are being created and where production is underway. Infrastructure Fund We are supporting these investments with a renewed focus on expanding the country’s economic and social infrastructure. We have established the Infrastructure Fund, with a R100-billion allocation from the fiscus over 10 years, to leverage blended financing from private investors and multilateral development banks for infrastructure. We have prepared a pipeline of projects in water, sanitation, energy, transport, digital infrastructure, agriculture, agro-processing and human settlements. Construction on a number of these catalytic projects will commence this year. A Presidential Climate Finance Task Team has been established to lead the mobilisation of funds for our just transition to a low-carbon economy. Headed by former Reserve Bank Deputy Governor Daniel Mminele, this task team will lead engagements on the R131-billion just transition partnership with the European Union, France, Germany, the United Kingdom and the United States. This partnership will involve repurposing and repowering some of the coal plants that are reaching the end of their lives and creating new livelihoods for workers and communities most impacted by this change. All this work is part of the Economic Reconstruction and Recovery Plan that we put in place in October 2020 to drive growth and job creation in the aftermath of the pandemic. The measures that form part of the plan underpin the social compact that we are building among social partners, and specifically between government, labour, business and the community constituency. We seek a new consensus that draws together the resources, capabilities and efforts of all sections of society to achieve our common goal of a rapid and sustained recovery. We see this social compact in action through initiatives like the Youth Employment Service, which is a collaboration between government and business to provide work experience opportunities to unemployed youth. We see it at work in the Presidential Employment Stimulus, which has provided job and livelihood opportunities to over 800 000 people in the 17 months since it was established. We see this social compact at work in our infrastructure programme, in the several Soutpan Solar Power assists in helping South Africa shift towards clean energy production. This 28MW solar photovoltaic (PV) power plant began operations in 2014 and generates 61 000MWh per year, which is fed into the country’s national grid. Credit: Soutpan Solar Power

INVESTMENT Opportunity magazine was on display at the Invest SA stand at the Fourth South Africa Investment Conference. The President of the African Development Bank Group Akinwumi A Adesina and the President of South Africa, Cyril Ramaphosa. Minister of Trade, Industry and Competition, Ebrahim Patel. Credit: African Development Bank industries that have developed masterplans to expand investment and production, and in our demand-led skills development programmes. Stable framework This is supported by a macroeconomic framework that is clear, stable and prudent. We are working to steadily reduce our deficit and debt burden. We are shifting public spending away from consumption and servicing debt towards supporting capital investment, productive activity and social development. It is nearly four years since we embarked on the ambitious drive to raise R1.2-trillion in new investment over five years. Despite the impact of the pandemic, by the time of the Third South Africa Investment Conference in 2020, we had raised a total of R774-billion in investment commitments. We are two-thirds of the way to reaching our target. Of the R774- billion committed, around R316-billion has so far been invested. Of the 152 investment pledges, 45 projects have been completed. A further 57 are under construction. Fifteen have been put on hold, in several cases due to the impact of the pandemic. The investments that have been realised since our first conference have created job opportunities, increased localisation and expanded local value chains. They have brought skills, technology and know-how into our economy. Whether it is a young person employed in a data centre, a worker at an auto plant, or a small business supplier to a renewable energy plant, these investments are changing people’s lives. The chance to earn a decent livelihood is fundamental to the dignity and worth of every human being and it is these investments that are making the difference. Today, at this Fourth South Africa Investment Conference, many companies will come forward to make new investment commitments. They will do so because they see opportunity in this country. They see beyond the difficulties and challenges. They see reform and progress. They see an open society that has enabled us to weather many storms. They see a strong and vibrant democracy, a diverse media and an active civil society. They see durable institutions, an independent judiciary and the rule of law. After a decade of state capture, they see a country that is confronting corruption and criminality and that is rebuilding its law enforcement agencies and strengthening the capacity of the state. They see a well-regulated banking, financial and taxation system and a transparent budget process. These investors see a Constitution that enshrines the rights of employer and employee alike, that advances the rights of the landless as it does those of property owners, that protects workers and businesses and that prevents the arbitrary exercise of power. As we continue along the path of reconstruction and recovery, I call on all investors, entrepreneurs and business people to be part of this journey. As investors, you need to know that your investments are secure, that the operating environment is stable, and that you are supported by policy certainty and regulatory safeguards. You need to know that the measures we are taking to tackle crime and damage to infrastructure are having an effect. Your investments are making are a difference in local economies and in people’s lives. We therefore invite you to be part of South Africa’s growth story. We invite you to be part of a young, dynamic, resilient nation positioning itself at the forefront of progress and change. We are forging ahead to transform our economy, to unlock our country’s potential and to create meaningful livelihoods for all our people. And we are determined to leave no-one behind. Global Africa Network Media Investment Manager Gabriel Venter presents President Cyril Ramaphosa with a copy of the annual South African Business guide.

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