South Africa continues to intensify measures aimed at accelerating economic growth and resolving the triple challenge of unemployment, poverty and inequality as projected by the National Development Plan (NDP.) The Nine-Point Plan sets out the specific interventions for growing and transforming the economy, creating jobs and attracting investment. Improving policy coordination, infrastructure development, making it easier to do business in South Africa and boosting investment spending is creating an enabling environment for economic growth.
The Economic Cluster has noted the strong rebound in economic growth in South Africa with Gross Domestic Product (GDP) growing by 3.3% in the second quarter of 2016. The main contributors to the GDP growth rate were the manufacturing industry and the mining and quarrying industry. Manufacturing increased by 8,1%, largely as a result of higher production in petroleum, chemical products, rubber and plastic products; and motor vehicles, parts and accessories and other transport equipment. Mining and quarrying grew by 11,8%, largely as a result of higher production of platinum group metals. The Agriculture sector remains weak as a result of the effects of the severe drought that South Africa has experienced. The South African economy would have grown even faster were it not for the negative effects of the drought.
Government is buoyed by the demonstrated resilience of the South African economy and is cautiously optimistic that the return to growth in the Manufacturing and Mining sectors can be sustained over the next few quarters. The Economic Cluster will continue to monitor economic growth and intervene where necessary to facilitate investment and create an enabling environment for inclusive growth so as to address our triple challenges of unemployment, poverty, and inequality.
The Economic Cluster has also taken steps to accelerate implementation of the Nine-Point Plan as directed by the recent Cabinet Lekgotla. The Economic Cluster is at an advanced stage in preparing for the implementation of 40 high-impact investment projects in Agriculture and Agro-processing, Agri-parks, Energy, Infrastructure, Beneficiation and Manufacturing subsectors. Of these 40 projects, 10 have been assigned high-priority status and will be fast-tracked and monitored by the Investment Inter-Ministerial Committee (IMC). Across the 40 projects, InvestSA is co-ordinating the completion of feasibility studies, and the provision of regulatory and incentive support. Strong partnerships between government, labour and the private sector are necessary to ensure the successful operationalisation of the priority projects.
Some of the key highlights that occurred during the latter part of August include: the Coega Development Cooperation historical signing of an R11bn Investment with the Beijing Automobile International Corporation (BAIC), the biggest automotive investment in Africa in the last 40 years. The launch of the 50/50 Farming Pilot project, which is aimed at strengthening the relative rights of farmworkers; the launch of the Bombardier Transportation’s first Propulsion and Control Manufacturing facility for use in Transnet’s locomotives; and the launch the second intake of the War on Leaks project, which will see over 7,000 artisans trained in critical skills required in the economy to minimise water losses.
Through the Export Marketing and Investment Assistance Scheme of the Department of Trade and Industry, a business delegation consisting of 27 South African companies participated in the 52nd edition of the Maputo International Trade Fair from 29 August to 4 September 2016. This exposed the South African companies to trade and investment opportunities available in Mozambique and other countries.
The Economic Cluster reaffirms its commitment to empower women to enable them to participate fully in the country’s economy. The empowerment of women through the Nine-Point Plan and departmental programmes plays an important role towards advancing the country’s economy. Government-led programmes support the advancement and empowerment of women in the economy by providing them with skills development and financial assistance to own and manage their businesses.
Brand South Africa in partnership with Brand Finance will be announcing the country’s top commercial brands on 15 September 2016. We call on commercial brands to continue being key messengers and positioning South Africa as a competitive and attractive investment destination.