Foreign investment if nurtured can lead to jobs - Davies
Economy / 7 November 2018, 08:54am / Staff Reporter
CAPE TOWN - The Minister of Trade and Industry, Dr Rob Davies, said on Tuesday that foreign investment if targeted and nurtured can drive economic growth and in turn contribute to much needed job creation and economic inclusion for all.
Davies was addressing the South African Investment Seminar on the margins of the 1st China International Import Expo (CIIE) in Shanghai, in the People’s Republic of China.
The purpose of the Investment Seminar was to expand on the investment opportunities that exist in South Africa with a particular focus on the manufacturing sector. The seminar was organised jointly by the Department of Trade and Industry (the dti) and China Chamber of Commerce for Import and Export of Machinery and Electronic Products.
Minister Davies told the Chinese investors that South Africa’s investment pitch is based on “active improvement of the investment climate, active solving of any problem that investors may have, active presentation of the opportunities that exist, and building partnerships with investors.”
Minister Davies indicated that the country’s investment climate is also improving.
“We have made in-roads to improving our investment environment, we have been working diligently towards ensuring policy certainty and consistency, improving the performance of state owned enterprises and consolidating fiscal debt. South Africa is energised and government together with its social partners, business, labour and civil society is moving towards an inclusive economic growth path. The work of government, business, labour and civil society is progressing well,” stated Davies.
Currently there are 58 Chinese companies who have invested in South Africa with a capital expenditure of R69,4 billion between January 2003 and January 2018.
These investments are mainly in the automotives, electronics, metals, building and construction sectors, financial services. China’s first major investment took place in October 2007 when China's largest bank, the Industrial and Commercial Bank of China (ICBC), purchased a 20% stake in Standard Bank.
The majority state-owned ICBC paid cash for the stake, estimated at R36.7 billion.
However, over the period, the trade surplus is in favour of China. The trade deficit is due to the imbalances in the composition of trade between the two countries where South Africa continues to export primary products and commodities to China, and import manufactured and high-tech products from China.
Davies said that events such as the China International Import Expo will create opportunities to address the imbalance.
“Exhibitions like China International Import Expo give us an advantage in that we can display products, goods and services that we can supply the Chinese market. We look forward and hope that our exhibitors will be able to find a way to enhance the relationship with procurers from China”, added Davies.
Davies is leading a delegation of 27 South African organisations which include provincial investment agencies, Special Economic Zones, Export Councils, as well as private companies.
The delegation is being funded by the Department of Trade and Industry (the dti) through the Export Marketing and Investment Assistance (EMIA) Scheme.
South Africa is participating in the 3 main platforms of the 1st China International Import Expo (CIIE), namely Country Pavilion for Trade and Investment, Enterprise and Business as well as Fair International Trade Forum. These platforms will enable us to promote South Africa’s trade and investment capabilities.
Davies also visited the South African businesses that are showingcasing at the International Import Expo.