Although South Africa has been through a pretty tough year, Standard Bank Group Chief Executive Sim Tshabalala is confident that we will return our domestic economy to a much more rapid growth path, and that we will continue to maximise the opportunities for growth that exist across the continent.
“There are opportunities aplenty for investors,” Mr Tshabalala told investors and delegates at the South Africa (SA) Tomorrow Investor Conference in New York.
He said that he was delighted to see two good news stories about South Africa in this past week. First, the World Economic Forum Global Competitiveness Report 2015-16 has just been released. South Africa’s ranking has improved from 56th on the index in 2014, to 49th out of 140 economies in 2015.
“The improvement was driven by an increased uptake of information and communications technology across the country, improvements in innovation and labour market efficiency, and improvements in health and primary education. We unquestionably still have a lot of work to do in all these areas, but it’s great to see that we are trending upwards in these vitally important areas.”
The second piece of good news last week was about Johannesburg, which was ranked as the 33rd most economically powerful city in the world – and the number one city in Africa – by the Global Financial Centres Index 2015.
“So if anyone is wondering whether South Africa can still legitimately claim to be the gateway to Africa, I think the answer remains a definitive yes. But, since this is a room containing many careful, and justifiably skeptical, analysts further evidence will be required, so here are three more data points: in September the Barclays Africa Trade Index confirmed that South Africa remains the top investment destination for British firms looking to expand into Africa, and also showed that South Africa ranks first on the continent for trade opportunities and market openness.
“We rank among the most open jurisdictions in the world for foreign development investment on the Organisation for Economic Co-operation and Development (OECD) Restrictiveness Index. And the 2015 Global Competiveness report ranked us first in the world – again - for the quality of our auditing and reporting standards and for our securities exchange regulation.”
He said that when the Johannesburg Securities Exchange inaugurated the SA Tomorrow Investor Conference two years ago, in October 2013, it envisaging it as an opportunity to bring together South African policy makers and business leaders with US investors to enable the sharing of perspectives on the challenges and opportunities facing the South African economy and South African firms.
“It’s proven to be a valuable and popular platform, and we’re delighted to be back here in New York.”
Mr Tshabalala said that he would like to reiterate that, while South Africa was undeniably facing some difficult challenges as a result of the commodities downturn, impacting the mining sector in particular, the country was already moving toward a knowledge-based economy, with a strong services sector.
“There’s a growing range of excellent opportunities for South African-based firms to export services – in areas as varied as technology, telecommunications and e-commerce, retail, financial services, construction, transportation, legal and other business services.”
He said that South Africa’s financial services firms are well positioned to serve the fast-growing demand for banking and insurance across sub-Saharan Africa – and to provide the seamless, cross-national services required by companies expanding across the continent.
“South Africa has been grappling with an electricity crisis over the last few years – but there are now effective measures in place to address this constraint, and we’re starting to see real and sustained improvements. What’s more, we’re exploring a broad range of new energy solutions, which will provide us with a much more sustainable supply mix.
“Government’s prioritisation of the natural gas and renewable energy sectors is already paying off, and we’ll see these sectors making a substantial positive contribution to energy security in the medium to long term.”