The timing of the upcoming local government elections, among other factors, has led to the decision to postpone this year’s SA Investment Conference to March. That's according to Trudi Makhaya the special economic adviser to President Cyril Ramaphosa.
In a recent statement, cabinet announced that the annual event, which has been held to attract fixed investment into SA each year since 2018, garnering interest from around the world, would be held over to March.
At the time of planning, there was uncertainty about the date of the election, Makhaya told Business Day in response to questions.
“Further, unlike previous years, there are various investment-related events of significance in the last quarter of 2021, such as the Dubai Expo and the Intra African Trade Fair that demand attention,” she said.
“These, alongside the upcoming COP26 and the recently held Symposium on Sustainable Infrastructure Development, provide ample opportunity to showcase policies and projects related to investment as 2021 draws to a close.”
The event has become a mainstay of Ramaphosa’s administration, which seeks to attract roughly R1.2-trillion into SA over five years. The SA economy — which had been battling poor growth and high unemployment even before the coronavirus struck — shrank 6.4% in 2020, adding renewed urgency to efforts to attract capital to local shores.
Despite several severe lockdowns, the 2020 conference was nevertheless held in defiance of the pandemic, largely online, and succeeded in attracting almost R110bn in investment pledges from companies such as Sasol, PepsiCo and Google.
The 2020 pledges were, however, only about a third of 2019’s commitments, which came in at R363bn. Nevertheless they took the total value of investment commitments generated by the conferences thus far to almost R774bn, or about 64% of the target over five years.
As part of government’s reconstruction and recovery efforts, Ramaphosa also vowed to push through long-delayed structural reforms aimed at improving the ease of doing business and pledged to work with the private-sector in rolling out much-needed infrastructure.
Nevertheless, amid the fallout from the pandemic, ongoing policy uncertainty and unexpected shocks such as the recent civil unrest, companies have held back on expansion.
Gross fixed capital formation fell to 13.7% of GDP in 2020 according to SA Reserve Bank data, its lowest level since the mid-1990s and well below the National Development Plan’s target of 30%.
In the coming years the Reserve Bank expects investment growth to remain weak — shrinking 0.3% in 2021, before improving to 0% in 2022 and 1.8% in 2023.
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