Pretoria – The South African economy is resilient despite the current unfavourable economic backdrop, President Jacob Zuma says.
“Despite a very unfavourable economic backdrop, the South African economy has been very resilient. Although remaining short of our growth ambitions, the country’s stability in the macro and fiscal framework and a diverse economy have shielded the economy from the full impact of the lower commodity prices which has hit developing economies,” said President Zuma on Thursday.
Addressing the South African delegation attending the World Economic Forum in Davos, Switzerland, President Zuma said although commodity prices remain as the country’s key export earner, growth in the service sector has provided a cushion.
“We need, as a country, to leverage further on this diversity,” said the President, adding that South Africa’s participation in the forum is aimed at raising the level of foreign direct investment in the country, among other things.
“Our message remains clear. South Africa is open for business. Secondly, we want to further expand the footprint of our companies on the continent and globally.
“We are here to say to investors that South Africa is where they should be, and we have very good reasons for saying so. We have a relatively diversified economic base.”
The South African economy offers world class business services in areas such as information and communication technology, transport and logistics, and financial and professional services.
“Our country is becoming a frontier for new sectors of Foreign Direct Investment such as the green economy, oil and gas and ocean economy sectors such as shipbuilding.”
The country is also investing in energy security to contribute to economic growth, and efforts to expand energy supply and sources are continuing.
The country is also diversifying its energy mix and it has attracted substantial private sector investment in clean energy, through the flagship programme, Renewables Independent Power Producers Programme.
Government is currently evaluating bids for coal Independent Power Purchases from the first bid window which will total 2500 megawatts of power when completed. Government is also preparing the procurement of 3100 megawatts of gas to power.
President Zuma added that government has heard calls to simplify the ease of doing business in the country.
“Domestic and international investors have appealed to government to help ease constraints and unnecessary bureaucratic delays and make South Africa more investor-friendly. In response, our government will be introducing an “Invest South Africa” (InvestSA) initiative during the course of the year.”
In addition, work has already begun to establish an interdepartmental clearing house or one stop shop service which will be rolled to all provinces.
The President has established an Inter-Ministerial Committee on Investment to work on the important project, which he chairs assisted by the Minister of Trade and Industry.
Government also decided that from 1 September 2015 all future legislation and regulations will be subject to a socio-economic impact assessment before being passed.
This process will promote greater policy coordination.
He reiterate that the National Development Plan (NDP) Vision 2030 remains the blueprint for socio-economic development and that it will continue to be implemented.
Last year, as part of implementing the NDP, the country introduced a nine point plan to ignite growth and create jobs.
“We have all the confidence, that through the partnerships formulated through WEF and other forums, we will continue to strengthen South Africa’s position as a preferred choice for investment.”
South Africa, he added, like many developing countries, faces challenges in the current global economic context, and also based on its unfortunate history.