Economic growth the missing key to SA's investment drive - Jacko Maree
IOL / 19 OCTOBER 2018 - 09:15 / SIPHELELE DLUDLA
JOHANNESBURG - Special envoy on investment Jacko Maree on Thursday said that the missing key to South Africa's investment drive was economic growth and confidence in the socio-political and socio-economic environment of the country.
In April, President Cyril Ramaphosa appointed Maree and four other special envoys, and tasked them with trawling the world to seek at least R1.2 trillion of investment in South Africa over the next five years.
Special envoy on investment/Former chief executive of Standard Bank group, Jacko Maree during the interview at Rosebank. Picture: Dimpho Maja/African News Agency (ANA)
During an exclusive interview at the Standard Bank's headquarters, Maree said that the inaugural South Africa Investment Conference next week will be seeking to speak with companies that are already doing business in, and with, South Africa, because those are "people that know and have an interest in South Africa".
Maree said the conference was South Africa's platform to showcase the country's economic potential to the world's investors as government and consumer spending was strapped by the stagnant growth, adding that there was also no economic boom in any of the emerging markets currently to create a demand for the country's resources.
"We've invited the major listed companies, probably 150 or so, and probably another 100 unlisted companies. If you think about the U.S.$100 billion target that we've been set, you'll probably think half of that coming from companies in South Africa and about half of that coming from overseas," Maree said.
"But investment by South African companies is very important because a lot of the foreign companies say they want to follow domestic companies and it is not their responsibility to grow our economy. Investment is really important because it is how you get the economy to grow faster.
"But a thing about investment is that it requires confidence. Investors are looking at making long-term outlook, 10 to 15 years, and they want to see the right sort of economic policies are being followed to promote growth. You can do very little in terms of moving South Africa forward if we don't have growth."
Maree admitted that South Africa had proven to be a difficult sell for foreign investors because of a number of issues related to stagnant economic growth, policy uncertainty, business confidence, and crime and corruption.
Last month, the domestic economy entered a technical recession, following two consecutive quarters of contracting economic activity after quarter-on-quarter GDP contracted by 0.7 percent in the second quarter. As a result, the Reserve Bank now forecasts growth in 2018 to average 0.7 percent, down from 1.2 percent in July, while the forecast for 2019 and 2020 is unchanged at 1.9 percent and 2.0 percent respectively.
But Maree said that the economy was starting to regain confidence and change investor sentiment in South Africa's economy as lots of sensible initiatives were being put in place for jobs and growth, such as measures announced during the "stimulus package", the fixing of the Mining Charter, tackling corruption and so on.
"People are starting to say hey, this government is serious, this country is serious. People don't to hear that you are open for business, they want to see it," Maree said. "Of course we still have many hurdles and problems to deal with, but at least we are moving in the right direction."
Meanwhile, Yasushi Naito, Counsellor of the Consul of Japan in Cape Town, confirmed during a telephone conversation that Japan's multinational companies will be attending the conference and that major investment announcements can be expected.
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