Investment in South Africa - South African Embassy to the Kingdom of the Netherlands (2024)

Information on investing in South Africa

TheTrade and Invest South Africawebsite was launched in 2007, offering investors and business people free access to specific investment and trade opportunities in South Africa. The fully searchable database enables users to quickly access opportunities relevant to their sector or region. Visit thesite guide(www.tradeinvestsa.co.za) for a more detailed explanation of Trade and Invest South Africa’s different sections.

Reasons to invest in South Africa

South Africa today is one of the most sophisticated and promising emerging markets globally. The unique combination of a highly developed first-world economic infrastructure and a huge emergent market economy has given rise to a strong entrepreneurial and dynamic investment environment.

Macro Economic Stability

The success of the first democratic election in 1994 put the economy on a growth path and created a conducive environment for both domestic and foreign investment. During the latter half of 1997 the world economy and especially emerging markets were negatively affected by the East Asian financial crisis. South Africa’s economy was no exception and the economy grew by only 0.8 per cent in 1998 compared to 2.6 per cent in the previous year.

The economy recovered quite robustly after 1998 before world economic conditions began to deteriorate towards the end of 2000. The weakening of the international economy resulted in a slowdown in growth in South Africa during the first quarter of 2001 but the domestic economy picked up again in the second quarter of 2001, although it suffered the effects of the events of 11 September. However, South African trade is diversified across a range of products and markets, and has weathered adverse international conditions fairly well so far.
Costs of doing Business
The costs of doing business in South Africa compares favourably to other emerging world markets. The costs for labour, land, rental, human resources, transportation and general living expenses do vary from province to province. Gauteng as the economic hub of South Africa is only marginally higher than the other provinces, yet it offers business amenities that have a world class standard.
Skills
South Africa possesses a large resource base of skilled, semi-skilled and unskilled labour. The South African government has introduced wide-ranging legislation to promote training and skills development and to fast-track the building of world-class skill and competence.

A strong network of universities and other tertiary education institutions is home to a host of leading international academics and researchers, with the majority of research and development in South Africa undertaken at the country’s universities.

Further details on the skills of our human resources are as follows:

• Highly attractive and competitive wage rates at all levels
• Abundant labour at all levels
• Blue collar
• Clerical, technical and administrative
• High level managerial
• 85% literacy rate
• 21 universities and 50 Further Education and Training (FET) colleges will eventually replace the current 152 technical colleges
• Unemployment rate of 30% -40%

TISA
Trade and Investment South Africa
Trade and Investment South Africa, a division of the dti, is charged with the primary responsibility of developing South Africa’s industries.

Trade and Investment South Africa is the essential point of contact for anyone involved in investment and export promotion in this country. It opens doors into global export markets through expert market intelligence, capacity-building opportunities, access to incentives and exposure at trade shows and exhibitions across the world.

Trade and Investment South Africa’s core functions include providing co-ordination; developing and promoting exports and investment; and creating and changing policy.

Trade and Investment South Africa focuses on the following sectors of the South African economy that have shown the greatest growth potential and marketability.

• Agro Processing.
• Chemical and Allied Industries.
• Clothing, Textiles, Leather and Footwear Cultural Industries.
• Exportable Services (Business Process Outsourcing) Information and Communication.
• Technologies and Electronics.
• Metals and Mineral-based Industries Tourism.
• Transport Industries (Automotive, Aerospace, Marine and Rail).

Trade and Investment South Africa identifies opportunities arid provides core market intelligence in 44 offices in foreign countries within South Africa’s diplomatic missions worldwide. It is a major point of contact for investors and exporters, with expertise in helping investors and exporters resolve the many practical, day-to-day problems encountered in doing business.

Trade and Investment South Africa is also mandated with developing small and black economic empowerment (BEE) exporters and to manage the Export Marketing and Investment Assistance Scheme (EMIA) as a key enabling incentive. Through EMlA funding is provided to companies for:

• Primary export market research.
• Foreign direct investment research.
• Exhibition assistance.
• Outward-selling trade missions.
• Outward-investment recruitment missions.
• Inward-buying trade missions.
• Inward-investment missions.
• Assistance to industry-specific sectors.
• Export readiness.
• Exporter development.

In addition, the formation of industry-based export councils to assist exporters in reaching their targets is promoted.