Trade and Investment South Africa, a division of the dti, is responsible for the attraction of foreign and domestic investment into all sectors of the South African economy. Priority sectors have been identified as possessing a high degree of potential for achieving the national economic objectives of economic growth, employment creation and redistribution of the ownership base within the economy.
To achieve this objective of attracting investment, the division offers an array of services to potential, new and existing investors. These include the following:
- General information regarding the macro-economic position of South Africa, the overall business environment and the process of investing in the country;
- Detailed sector-specific information, identifying investment opportunities in the 10 priority sectors identified by the organisation;
- Information regarding government incentives and other assistance.
- Assistance in organising visits or participating in events such as exhibitions in South Africa;
- Assistance in expediting incentive applications, work permits and other documentation required by investors;
- Investor aftercare.
In addition to the services offered to investors on an individual or collective basis, as described above, the division is responsible for the packaging, promotion and implementation of projects aimed at addressing identified investment opportunities. A number of measures are utilised in the process of promoting these projects, including participation in National Pavilions and exhibitions, outward and inbound investment missions, investment conferences, focused sector-based presentations, and promotion through the dti’s network of Economic Offices, based in about 45 countries throughout the world. These offices play a crucial role in promoting South Africa’s position as an economic environment attractive for investment by international companies.
Customised Sector Programmes (CSP) is a sector development strategy that employs an action-based methodology to seek high-impact and enduring initiatives that will materially tackle the economic aspirations of our government. To this end, certain economic sectors have been identified as priority in terms of the country’s Microeconomic Reform Strategy (MRS) and Integrated Manufacturing Strategy (IMS). These priority sectors are:
- automotive industry
- marine, rail and aerospace industries
- business process outsourcing/IT-enable services
- capital equipment
- clothing, textiles and footwear
- cultural industries (including film)
- electro-technical industries
- mining and mineral beneficiation
A sector development strategy and programme for each sector is in the process of being finalised. These programmes are aimed at identifying key sub-sectors within each sector, which exhibit for investment, exports, competitiveness, employment and equity.
Following the evaluation of these sub-sectors and the identification of investment and export opportunities, the Export Promotion and Development Division and the Investment Promotion and Facilitation Division of Trade and Investment South Africa assume the responsibility for the packaging, promotion and implementation of those projects aimed at addressing the identified opportunities.
Targeting key countries for the generation of FDI into South Africa is commonly accepted – there has and will probably continue to be a concentration of FDI from specific high potential countries. This targeting will be refined at the investor and project level. The investment promotion unit will establish a priority country list (based primarily on the CSPs) as a key strategic priority. This strategic information will inform the nature and extent of resources in foreign offices (the other leg is export promotion).
It uses various ways and or instruments to attract FDI into the country, such as:
- investment recruitment missions;
- ministerial investment recruitment missions;
- enhancing and expedite investment recruitment through the Export Marketing and Investment Assistance Scheme;
- joint investment recruitment missions with provincial investment promotion agencies abroad;
- participating in investment-focussed exhibitions abroad;
- expediting the processing of applications and permits to ensure effective entry into the country by prospective investors.
We also work closely with the following organisations to attract investment into the country:
The International Investment Council (IIC). The IIC comprises a number of leading international business executives that are advising the president on South Africa’s investment environment and policies to ensure higher investment flows to the country.
The International Marketing Council (IMC). The IMC was established in August 2000 to create a positive and united image for South Africa. It is implementing a pro-active and co-ordinated international marketing and communication strategy for the county.
Various government departments and provincial investment promotion agencies that are instrumental in removing obstacles to investment.
Focused investment facilitation services provided by Trade and Investment South Africa assist investors on a personal basis to remove obstacles in the investment process.
The dti’s foreign economic representation located in major investing countries overseas also play an integral role in promoting investment to South Africa. These offices enhance the international presence of South Africa’s image and conduct investment promotional activities aimed at targeting potential investors.
Total South African exports have grown by 47% in real terms since 1990. Most of this occurred after 1994. Exports have become diversified. Reliance on gold and diamonds has halved in favour of newcomer sectors, such as vehicles and beverages.
There has been a significant increase in the export share of human capital-intensive and technology-intensive sectors. However, the dominance of natural resources (gold, coal, diamonds, ferrous and non-ferrous ore) exports is still evident.
Manufacturing has evolved into the largest broad export sector, overtaking mining and quarrying in the mid 1990s. All manufacturing sub-sectors except basic non-ferrous metals and textiles experienced positive export growth over the past decade.
The top 15 manufacturing sub-sectors in South Africa are predominantly capital intensive and grew by an annual average of 19% between 1990 and 2003 in real terms. The export-intensity of manufacturing has increased, and manufactured exports reflect a growing share of high-tech export products, resulting in high-skilled to skilled intensive sectors dominating the skill usage in South Africa’s export sector. Motor vehicles and related exports have also boosted the technological composition of South Africa’s exports, and exporting has become a permanent feature of the manufacturing sector (in particular capital-intensive sub-sectors).