Public Enterprises Minister, Mr Malusi Gigaba -in the United Kingdom to drum up support for financing in State-Owned Companies (SOEs), has been told by CEOs from China that they saw South Africa as the investment gateway to the rapidly growing African market. The integration of the Southern African Development Community (SADC), Common Market for Eastern and Southern Africa (COMESA) and the Eastern African Community (EAC) will open up a sub-Saharan behemoth free trade area of 500 million people when agreed, and South Africa will be one of its major drivers. During a whirlwind 72-hour visit, Minister Gigaba delivered a lecture to CEOs of Chinese state-owned companies at a leadership event at the University of Cambridge before returning to The City – London’s financial district – for meetings and briefings with investment advisers and fund managers. “The message we have got from the Chinese SOEs, especially, was that they view South Africa as the gateway to Africa. They have billions of dollars available to invest and they are looking at South Africa and Africa in general very keenly,” Gigaba said. South Africa and China are both members of the BRICS group of emerging markets countries – alongside Brazil and India. Malusi said beyond being an economic force, he expected the BRICS, with time, to grow into a strong political voice on global issues. “South Africa’s growth at the moment is anchored by investment by SOC since the private sector has taken a more cautious approach. The Chinese companies have billions of dollars to spend and they see Africa as a natural home to most of that cash. They believe South Africa is a stable and welcoming entry point,” Gigaba said. Gigaba said South African state-owned companies were on course to invest millions of dollars in infrastructure and other new projects, with cash from their balance sheets as well as foreign investment.
Logistics group Transnet has completed its latest round of capital raising, obtaining $1 billion in foreign investments during a June roadshow – double its initial target.
Power utility Eskom had also raised money from the markets as well as obtained loans from global lenders like the African Development Bank (AfDB) to fund their expansion. South Africa itself was focusing on raising its investment game in Africa. Aviation – with links from Johannesburg to west Africa and central Europe – was one central area, and logistics and infrastructure in eastern Africa another. Gigaba said he wanted South African companies to do more to understand how to do business in the rest of Africa – where cultural and other traditional business practices are different from their own country. Source: http://allafrica.com
