Issue 207 | 12 February 2016
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“ … our country remains an attractive investment destination. It may face challenges, but its positive attributes far outweigh those challenges.

“We must continue to market the country as a preferred destination for investments. This requires a common narrative from all of us as business, labour and government.”
President Jacob Zuma has moved to assure South Africans, uneasy about the current unfavourable economic conditions, that they should not be despondent, but rather the country should work together to turn the situation around.

In his State of the Nation Address on Thursday, 11 February 2016, watched by millions of people, President Zuma reiterated that the tough global and domestic conditions should propel "us to redouble our efforts, working together as all sectors".

He emphasised government’s commitment to continue to create the correct investment support infrastructure to attract foreign investments into the country.

“We have had fruitful meetings with business, including the high-level meeting with CEOs … we have heard the suggestions from the business community on how we can turn the situation around and put the economy back on a growth path,” President Zuma said.

He announced that government was developing a “One Stop Shop/Invest SA” initiative to signal that South Africa was truly open for business. Government would fast-track the implementation of this service, in partnership with the private sector.

President Zuma reminded South Africans in his speech that the country, like many other developing economies, had been a victim of the global economic downturn.

“Our reality right now is that global growth still remains muted. Financial markets have become volatile. Currencies of emerging markets have become weak and they fluctuate widely.

“Because our economy is relatively small and open, it is affected by all of these developments. Our economy is also affected by domestic factors such as the electricity constraints and industrial relations which are sometimes unstable,” he said.

South Africa’s economy was also affected by domestic factors such as the electricity constraints and industrial relations which are sometimes unstable.

He urged South Africans to take advantage of the exchange rate as well as the recent changes of visa regulations, to boost inbound tourism. SA Tourism would invest R100 million a year to promote domestic tourism, encouraging South Africans to tour their country, he said.

Progress is being made

Reflecting on the progress that has been made in the past few years, President Zuma mentioned, among others, that state-owned freight company Transnet had built rail infrastructure, which had enabled the country’s mines to move massive bulk of commodities through the ports to markets around the globe.

"Road agency Sanral has built some of the best roads in Gauteng and in many parts of the country and these “make us” the envy of many parts around the globe.

"The Trans Caledon Tunnel Authority has constructed dams of varied capacities, thus making it possible for South Africans to have access to safe drinking water.

“Eskom, in spite of the challenges, still manages to keep the economy going, against all odds. Our development finance institutions such as the Industrial Development Corporation, Development Bank of Southern Africa and others have provided finance for infrastructure, various industries and agricultural businesses without fail, even in the aftermath of the global financial crisis."
Nine-point plan

President Zuma also reflected on the progress of the nine-point plan he announced last year, saying, among others, that progress had been made to stabilise the electricity supply. There has been no load-shedding since August last year, which has brought relief for both households and industry alike.

In the 2015 SONA, the President announced the plan to help steer the economy out of the woods. The plan aims to boost economic growth and job creation and serves as a response to the gloomy global economic situation which impacts South Africa’s goal to grow its economy by 5% in 2019. It consists of, among others, revitalisation of the agriculture and agro-processing value-chain, promoting beneficiation, unlocking the potential of small business and the energy challenge.

President Zuma said government had invested R83 billion in Eskom, which had enabled the utility to continue investing in Medupi and Kusile, while continuing with a diligent maintenance programme.

Additional units from Ingula power station will be connected in 2017, even though some of them will begin synchronisation this year.

The multiple bid windows of the Renewable Independent Power Producer Programme have attracted an investment of R194 billion.

“This initiative is a concrete example of how government can partner with the private sector to provide practical solutions to an immediate challenge that faces our country”.

The President said this year government would select the preferred bidders for the coal independent power producer.

– Source:
“The African continent remains central to our foreign policy engagements.”
President Jacob Zuma said that South Africa continued to support peace and security and regional economic integration through participation in the African Union and the Southern African Development Community initiatives.

“We continued to assist sister countries in resolving their issues, for example in Lesotho and South Sudan.

“The South African National Defence Force represented the country bravely and remarkably well in peacekeeping missions on the continent.  We are truly proud of our soldiers. They will be showcasing their capability in Port Elizabeth from the 13th to the 21st of February, the celebration of Armed Forces Day.

“The agreement by BRICS nations on the New Development Bank or BRICS Bank came into force and the bank is envisaged to approve its inaugural projects in April this year.

“We participated in the India-Africa Summit as well as the Forum on Cooperation between Africa and China as we strengthened these important partnerships.

“China announced investments of US$50 billion dollars of which South Africa will receive US$10 billion for infrastructure, industrialisation and skills development.

“On North-South cooperation, we continued our engagements with the European Union (EU) as a bloc which is our largest trading partner and foreign investor.

“Over 2 000 EU companies operate within South Africa, creating over 350 000 jobs.

“South Africa’s relations with the USA and Canada continue to strengthen, especially in the areas of economy, health, education, energy, water, safety and security, capacity-building and the empowerment of women.

“The renewal and expansion of the African Growth and Opportunity Act (AGOA) provides a platform for the enhancement of industrialisation and regional integration. All outstanding issues around AGOA are being attended to.”
  • R100 million – to be invested a year by South African Tourism to promote domestic tourism.
  • 10th – South Africa’s ranking in the World Economic Forum Competitiveness Report.
  • US$50 billion – investments announced by China.
  • US$10 billion – investment from China to South Africa for infrastructure, industrialisation and skills development.
  • 5% – the annual growth target set in the National Development Plan to be achieved by 2019.
  • R25 billion – investments attracted by incentives for the automotive sector over the last five years.
  • R83 billion – government’s investment in Eskom.
  • R194 billion – an investment attracted by the Renewable Independent Power Producer Programme.
  • 9 600 – megawatts of energy to be introduced in the next decade.
  • Agriculture and land reform
  • 5 – the number of agri-parks being constructed.
  • 27 – the number of proposals received from commercial farmers.
  • 4 – the number of proposals received from commercial farmers that are being implemented in the Eastern Cape and the Free State.
  • 12 000 – the maximum hectares to be allowed for land ownership.
  • 120 000 – the number of new land claims lodged by December 2015.
Water and sanitation
  • 30 million – cubic metres of water to be provided per year by the Mokolo and Crocodile Water Augmentation projects in Lephalale, Limpopo.
  • 13 – the raised metres of the Clan William Dam wall in the Eastern Cape.
  • 15 000 – number of young people being trained by the Department of Water and Sanitation to curb water wastage.
Oceans economy
  • R7 billion – money committed to new port facilities by the Transnet National Ports Authority.
  • 3 000 – kilometres of coastline surrounding South Africa.
  • R660 million – investment brought by a fuel storage facility in Cape Town.
  • R350 000 – investment being committed in the aquaculture sector.
  • 9 – aquaculture farms already in production in the Eastern Cape, KwaZulu-Natal, Western Cape and Northern Cape.
Broadband roll-out
  • 5 000 – government facilities in eight district municipalities to benefit from broadband roll-out.
  • R740 million – funding for a broadband roll-out allocated over a three-year period to connect more than 5 000 government facilities in eight district municipalities.
  • 62 – life expectancy for both male and female South Africans, which is an increase of eight and half years since 2005.
  • 3,2 million – HIV-positive people who benefitted from a massive roll-out of HIV testing and treatment in 2009.
Safety and security
  • 57 – the number of police officers murdered to date during the 2015/16 financial year.
  • 2 000 – number of European Union (EU) companies operating in South Africa.
  • 350 000 – number of jobs created by the EU.
  • Source: Government Communications
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