Remarks by President Ramaphosa during the SA-US Interactive Business Forum, 23 September 2024
President of the New York Stock Exchange, Ms Lynn Martin,
Minister of Trade, Industry and Competition of the Republic of South Africa, Mr Parks Tau,
Ministers from the Republic of South Africa,
Representatives of business from the US and South Africa,
Guests,
Ladies and Gentlemen,
Good afternoon,
Allow me to begin by thanking the leadership of the New York Stock Exchange for hosting this South Africa/USA Business Forum.
This is a timely intervention.
It is my first visit to the US since we held general elections in May this year that ushered in a Government of National Unity.
Under the GNU, ten political parties have come together and committed to a common programme of action and national agenda.
We are prioritising inclusive growth and job creation, reducing poverty and tackling the high cost of living, and building a capable, ethical and developmental state.
South Africa intends to stay the course on the structural economic reform process, on scaling up investment in key infrastructure, and on improving the business operating environment.
Our efforts to promote South Africa as a favourable investment destination continue to yield positive benefits.
In 2018 we set ourselves a target of attracting R1,2 trillion or approximately USD 63,6 billion in investment over a five-year period.
Last year we achieved our target ahead of schedule.
These investments have been broad in scope and are in a number of key economic sectors such as mining, manufacturing, ICTs, agriculture, automotive, infrastructure development and the digital economy.
A significant proportion of these investments have been in energy, notably renewable energy.
We have announced a new target of approximately R2 trillion or approximately USD 100 billion over the next five-year period up to 2028.
The far-reaching structural reforms we have implemented over the past six years have opened up the country to increased levels of investment that continues to grow.
This has been particularly evident in the clean energy sector that has attracted significant investment since our mobilisation drive began.
This bodes well not only for our economy and our nation’s energy security, but also for our commitment to decarbonising our economy in line with global climate change commitments.
At the same time, we are equally committed to a Just Energy Transition that is inclusive, that take our developmental needs into account, and that leaves no community behind.
We have a supportive and enabling industrial policy that incorporates amongst others expanding the special economic zones, driving export-led growth, and harnessing the potential of the Africa Continental Free Trade Area or AfCFTA. In January 2024 we began preferential trading under the AfCFTA.
The Government of National Unity is furthermore committed to prudent monetary and fiscal policy and to strengthening regulatory and legislative frameworks to combat corruption.
The multidisciplinary team led by the National Treasury continues to make progress in the efforts to remove South Africa off the Financial Action Task Force grey list.
In November 2023 the FATF noted that we had made progress in strengthening measures to tackle money laundering and terrorist financing and upgraded us. We expect to detail more progress in this regard in our next report back schedule for October.
The structural reform process that began under the previous administration further bolsters our position as a destination of choice for foreign investors.
The US State Department’s 2024 Investor Climate Statement highlights just some of South Africa’s unique value propositions.
These include being the most advanced, diverse economy in sub-Saharan Africa; having deep and well-regulated capital markets, stable institutions, a mature financial and services sector, and being a hub for regional investment.
South Africa and Africa are ripe for investment in financial services, advanced manufacturing, energy, healthcare, infrastructure development, mining, science and technology and other sectors.
South Africa is also developing the value chains of the future.
With substantial reserves of critical energy transition minerals, we are positioning ourselves to be at the forefront of the green energy revolution.
As the country with the world’s largest platinum group metal reserves, we have a competitive advantage when it comes to the production of sustainable energy technologies, including electric vehicles, new energy vehicles and renewable energy components.
South Africa has also developed a regulatory framework to harness the potential of the hydrogen economy.
We have developed a Just Energy Transition Investment Plan that outlines the scope and scale of financing needed to meet our decarbonisation objectives, as well as the investment opportunities on offer.
I want to call on US business to partner with us in this regard.
We have also established an Infrastructure Fund, with a USD 6.5 billion allocation over 10 years, to leverage blended financing from private investors and multilateral development banks. The Fund has a pipeline of projects in water, sanitation, energy, transport, digital infrastructure, agriculture, agro-processing and housing.
As the South African government, we have consistently affirmed the importance of collaboration with the private sector to drive economic growth and job creation, and to resolve structural impediments to growth.
The government/business partnership we established last year at the height of our nation’s energy crisis has since been expanded to include collaboration to resolve challenges in transportation and logistics, as well as to tackle crime and corruption.
At our last meeting with the business community in August, one senior South African business leader described the Government of National Unity as new era of partnership, and this is accurate.
South Africa has indeed embarked on a new era of growth, progress and inclusive, shared prosperity.
We are grateful to the New York Stock Exchange for the commitment that it has shown to expanding bilateral relations.
The Memorandum of Understanding signed between the NYSE and the Johannesburg Stock Exchange in 2022 was an important milestone with respect to developing new products, knowledge sharing around Environmental, Social and Governance, Exchange Traded Funds and digital assets.
The NYSE’s significant market capitalisation and robust trading activity underscores its pivotal role in global finance.
Likewise, the JSE, Africa’s largest stock exchange, also offers significant market depth and liquidity.
Through strategic partnerships and dual listings, the JSE enables South African firms to tap into the extensive capital and investor base of the NYSE.
Conversely, the JSE it offers US companies a gateway to African markets, providing them with valuable insights and opportunities for expansion.
This collaboration helps both exchanges strengthen their market positions, promote cross-border investment and drive economic growth on a global scale.
The US is one of South Africa’s most valued trading, investment and development partners.
Our cooperation is aligned to South Africa’s national priorities and extends to people-to-people cooperation in the spheres of education, culture, tourism and institution building.
A number of US companies operate in South Africa, including Procter and Gamble, Ford Motor Company, GE Healthcare, Amazon, John Deere, General Motors and Walmart.
Last year, the United States was the second largest destination for South Africa’s exports with bilateral trade totalling USD 17.6 billion.
Between 2019 and 2023, total exports to the US accounted for 8 per cent of all South African exports; whilst under AGOA and the GSP, South African exports to the US accounted for 25 per cent of South Africa’s global exports.
AGOA has enabled us to expand the breadth and depth of our trade ties with the US and in the process, created more South African jobs.
South Africa is also an anchor for regional value chains in the continent, sourcing inputs from many countries in the region into its manufacturing sector.
These are then re-exported as final products to foreign markets including to the US under AGOA.
Besides the automotive sector, AGOA has bolstered South African exports of wines, citrus, iron and steel, organic chemicals and precious stones.
We appreciate the substantial contribution that AGOA has made towards job creation in these labour-intensive sectors.
Ladies and Gentlemen,
The advent of the Government of National Unity has renewed investor optimism in the South African economy.
The message I bring to US investors today is that this optimism is well-placed.
South Africa is firmly on the road to recovery, and we invite you to be part of this journey.
Investments in South Africa are secure. Our business environment is stable.
This is supported policy certainty and regulatory safeguards.
Africa too has a compelling growth story.
By 2050, the population of Africa is expected to have grown to 2.5 billion people.
According to the African Development Bank, the continent is set to be the second-fastest growing region in the world.
Growth in Africa is expected to average 3.7 percent in 2024 and 4.3 percent in 2025.
This exceeds the projected global average of 3.2 percent.
Seventeen African economies are projected to grow by more than 5 percent in 2024.
This demonstrates the resilience of African economies despite numerous global shocks.
The AFCFTA will remove barriers and unlock opportunities for trade and investment for local and global businesses.
It will drive a wave of industrialisation and create dynamic regional value chains.
This too presents opportunities for US businesses and investors, and opens up new markets for their goods, products and services.
Mutually beneficial trade and investment not only unlocks the dynamism and potential of an entire continent. It will also aid Africa’s efforts to achieve the Sustainable Development Goals.
I want to invite US businesses to join us at next year’s South Africa Investment Conference where you will be able to see for yourselves the opportunities on offer to invest in our economy.
South Africa is open for business. Sustainable and inclusive growth spurs development and creates jobs.
I look forward to our discussions today.
Together, we can forge a path to shared success and progress, leveraging our combined strengths to achieve enduring prosperity for our people.
I thank you.
Issued by: The Presidency
Pretoria