Investment and trade initiatives have been at the forefront of SACCUSA’s aim over the past few months. Various interactions with key players in the economic sector took place, with a continued focus on promoting greater two-way trade and investment partnerships which will bolster Africa’s role in the global economy.
South Africa is open for business and welcomes trade, investment, and tourism as a gateway to the African continent. This was the message from South Africa’s Ambassador to the United States, HE Nomaindiya Mfeketo, when she recently addressed business leaders at a luncheon held by the Metro Atlanta Chamber and the South African Chamber of Commerce in the USA (SACCUSA).
The event was held to strengthen business and trade ties between SA and the USA. HE Mfeketo said to delegates: “As you may be aware, South Africa, as Africa’s most industrialised economy, is in the grip of a severe energy crisis that is not only disrupting the lives of millions of people but also threatening the economy and food supply. The major problem with power generation in South Africa is that there has been under-investment in the energy sector over the past two decades. As a result, much of South Africa’s state-owned utility, Eskom’s coal-fired power plant fleet is ageing, requiring rotational load shedding to be implemented. Eskom supplies more than 90% of the country’s electricity.”
She explained President Cyril Ramaphosa’s announcement of a national state of disaster over the electricity crisis and said the government’s emergency declaration would enable extra financing to be unlocked, which will fast-track regulatory processes. The appointment of a Minister of Electricity, with the purpose of coordinating the country’s response to this persistent power crisis, was a further development the ambassador relayed.
“However, this does not spell all doom and gloom, South Africa’s fiscal position has improved over the past two years, largely thanks to fiscal consolidation measures, such as budget discipline, together with better-than-expected tax collections, primarily driven by global commodities demand. Creating an enabling environment conducive to investment, both domestic and foreign, including political and policy certainty in the run-up to the 2024 general elections, will be an important foundation for the structural changes needed in the South African economy in the medium term,” she said.
The ambassador explained that leveraging the opportunities linked to its own energy transition goals was a move away from a coal-dominated energy mix, while overcoming its power generation shortfalls, as well as supplying and adding value to critical commodities in a global clean energy future.
“On the former, South Africa has massive renewables potential, not only in solar and wind, but also in green hydrogen. On the latter, it also has a notable comparative advantage in supplying key minerals and metals HE Mfeketo referred to the momentous US-Africa Summit held in Washington DC in December last year, which was a further significant milestone in the relations of Africa with the United States. A key pillar of this summit was the U.S.-Africa Business Forum (USABF), hosted under the theme, “Partnering for a Prosperous and Resilient Future.”
In addition, she noted
• Platinum group metals, used in catalytic agents in hydrogen electrolysis and fuel-cell applications,
• Vanadium, used in input for long-duration battery energy storage applications,
• Rare earth elements used in permanent magnets in the electrical motors of wind turbines and in electric vehicle motors, and
• Nickel, which has applications in EVs and battery storage, and hydrogen and geothermal technologies.
This event brought together African heads of state and US and African business and government leaders to advance mutually beneficial two-way trade and investment partnerships that bolster Africa’s role in the global economy, scale innovation and entrepreneurship, create jobs, drive advancements in key economic sectors, and foster inclusive and sustainable growth on both sides of the Atlantic.
Prior to the US-Africa Leaders’ Summit, President Ramaphosa, on invitation from President Biden, undertook an official working visit to Washington DC where the establishment of the South Africa-US Investment Advisory Task Force was announced.
The summit signalled the Biden-Harris Administration’s recommitment to sustained economic growth and mutual prosperity between the US and Africa, and to build new relationships and opportunities by:
• Strengthening trade between the United States and African countries,
• Increasing commercial opportunities across Africa and elevating Africa’s role in the global economy, and
• Announcing new or expanded investments and programming between US companies and African counterparts.
Ambassador Mfeketo said, as vital aggregators and multipliers in the business ecosystem, Chambers of Commerce like the Metro Atlanta Chamber, and SACCUSA are close to the pulse of businesses and have a deep appreciation of their needs and challenges.
“As the South African Embassy representative, we highly appreciate your steadfast partnerships over the years, to both the business community and the Government through your roles as bridge builders, facilitators, and enablers. For the purposes of today’s engagement, I have by my side, Mr Neil Diamond, a familiar face to all, and Mr Reginold Ncamane from the Embassy. In their roles, they represent South Africa’s dynamic diplomacy, which is its people, both young and old, in the diaspora, as well as in South Africa.”