Rob Davies, South Africa minister of Trade and Industry defines the reality of focusing on the challenges of home grown investment
We created our own investment promotion agency, which is now called 'Invest South Africa' It has been upgraded in its scope of work and is overseen by a committee, which is chaired by the president of South Africa, Jacob Zuma. Some of the weakness we've had is that there have been a number of regulatory decisions that have had to be taken in order for any investment to actually happen. Now we’ve got sharper tools to be able to smooth the way. Today South Africa has gained a reputation in manufacturing especially in the motor industry and renewable energy which are being used to spearhead its FDI policy, These are areas where foreign investors have responded quite positively.
"We've seen a very significant number of original equipment manufacturers investing in the South African motor industry, and newcomers coming in as well from places such as China. The same applies to the other areas likes the renewable energy, independent power-producers programme. We have the largest renewable energy programme on the African continent, but also one where there's recognition that it is one of the better designed programmes on a world scale. The broader lessons from this are that the way to boost investment is to develop clear value propositions and market them.
Promoting Internal Investment
Regional development is a booster to trade integration because Africa has a robust market share from any manufacturing that takes place here therefore the best way to promote internal and regional investment in Africa is to encourage integration
For us in South Africa, that's our priority as far as trade is concerned-to promote development integration on the African continent. We're part of the tripartite process, Southern African Development Community, or SADC, COMESA and the East African Community Free Trade Area, but we’re also supportive of a continental free-trade area. It's taking longer than is desirable at this point, but we’re doing our best to try to move some of the process further forward. One of the approaches that is moving, which is quite relevant to us, is that SACU-the South African Customs Union-and the East African Community are now engaged in serious line-by-ine trade negotiations.
The infrastructure building programme on the African continent [the Programme of Infrastructure Development Africa-PIDA] is an integral part of [the plans], and it's making some progress. The north-south corridor programme is making some progress too. All of these are steps we need to take to ensure a greater volume of intra-regional trade, but also intra-regional trade in value-added products. Request Full Details