Address by President Jacob Zuma to the South African Business Delegation in Davos, Switzerland

21 January 2015

Ministers,

Captains of Commerce and Industry,

Representatives of the World Economic Forum,

Compatriots,

It is wonderful to meet you again in Davos.

We meet during an important year in our country, the year of the Freedom Charter. The 60th anniversary of the Charter reminds us of our noble and just struggle for liberation which brought about the freedom and democracy we enjoy today.

In the Freedom Charter South Africans declared that South Africa belongs to all who live in it, black and white, and that no government can justly claim authority, unless it is based on the will of all the people.

Based on the Freedom Charter, we are building a South Africa that is united, democratic, non-racial, non-sexist and prosperous.

The Constitution of the Republic, our supreme law, is based on the principles from the Freedom Charter.

Our quest for inclusive economic growth is designed to help us achieve that type of society where everyone has a better life, as proclaimed in the Freedom Charter which says all shall share in the country's wealth.

Our message to our people this year is that we should continue working harder to build a country that belongs to all of us. We should build a country without poverty, inequality and unemployment.

We have developed the National Development Plan as an instrument to help us achieve these development goals.

We have committed ourselves to achieve five percent growth by the year 2019 which is necessary if we are to create the much needed jobs.

Our target to attract investments for the year 2013-2014 was 50 billion rand. We have achieved an investment pipeline of 60.5 billion rand of potential investment projects, reflecting both domestic and foreign projects.

This indicates that our country remains an attractive destination for investments. 

South Africa remains fully open for business. We are inviting both domestic and foreign business partners to invest in the South African economy.

We have identified some key job drivers in which we want to attract investments.

These are:

• Infrastructure development including energy, water, transport, information and communication technologies.

• Agriculture,

• Mining and beneficiation

• Manufacturing,

• The green economy and

• Tourism. 

We have added the blue economy in the past year, through our new Operation Phakisa NDP delivery programme, which is aimed at unlocking the potential of our country's oceans.

The blue economy offers opportunities in marine transport and manufacturing activities, such as coastal shipping, boat building, repair and refurbishment, offshore oil and gas exploration, aquaculture and marine protection services and ocean governance.

To further boost industrialisation and manufacturing, we have introduced 10 Special Economic Zones (SEZ), which will help us create new industrial hubs and clustering value chains.

The SEZ programme seeks to stimulate industrial capability and is promoted through an attractive incentive package, business support services, cluster development and minimal red tape.

Compatriots and friends,

Mining continues to be the backbone of our economy. South Africa is the wealthiest mining jurisdiction in the world with our non-energy mineral wealth being estimated at 2.5 trillion US dollars. (2010 values, Citi Bank Group).

We have been working hard together as business, government and labour to stabilise and revitalise the mining sector, and we are making progress.

Our "Framework Agreement for a Sustainable Mining Industry" has yielded desirable results as evidenced by stability in the sector and the attainment of aggregated growth of the industry recording growth of 5.7% year-on-year in September 2014 relative to the preceding year. We appreciate the cooperation of business and labour.

Compatriots

There are some areas of the economy that require more efforts from us especially with regards to the energy sector.

Our electricity infrastructure for example, was never designed to serve an expanded citizenry. Last year we celebrated the expansion of electricity to 11 million households.

In the past six months of the year we reached more than 100 000 homes. This extension of electricity to more households that had been excluded in the past, coupled with a growing economy, have sharply put pressure on the infrastructure, which needs improved maintenance and expansion.

We are currently considering options to increase the available electricity generation capacity and to manage demand over the next six months in order to reduce the risk of load shedding.

We will build on the success of the renewable energy procurement programme to ensure that we have a reliable, flexible, clean and cost competitive electricity generation mix.

Apart from the Eskom new build programme at Medupi, Kusile and Ingula, the Government has procured 4000 megawatts from the Independent Power Producers. To date 923.18 megawatts have been connected to the national grid.

The first two bid windows of the renewable energy procurement process attracted more than 82 billion rand from private investors, with window three expected to draw 51 billion rand at financial close.

South Africa is also the last frontier country for petroleum development, including off-shore oil and gas as well as shale gas prospects. 

We are also exploring nuclear and coal as part of the energy mix.

We are optimistic that the end result of the current challenges will be much improved energy resources for the country.

Our country is part of a growing continent. Regional integration continues to be the key phrase as we promote the competitiveness of the continent.

We are busy developing infrastructure that connects our country to the rest of the Continent, as part of the African Union's Presidential Infrastructure Championing Initiative (PICI).

We are also exploring measures to promote industrialization and regional integration which include the relaxation of customs and tax regulations that will assist with expediting and facilitating the movement of goods and services within the region.

Significant progress has been achieved on the establishment of the Tripartite Free Trade Area which includes the Southern African Development Community Common Market for Eastern and Southern Africa, and the East African Community.

The programme is expected to create a market of 2.6 trillion US dollars, with a combined population of 600 million people, which is approximately two thirds of Africa's total population.

Africa is therefore a growth frontier. We urge you as South African business to continue exploring opportunities within South Africa and also the continent.

There are many opportunities in South Africa. We believe the goals that are outlined in the National Development Plan are achievable.

We are working to achieve better schools and clinics, better roads, more water and electricity connections for our people.

We are building three brand new universities and 12 technical and vocational training colleges.

We are working together to promote the ease of doing business through the Presidential Business Working Group. Indeed, we are a country at work.

We are here in Davos to invite more development partners to join us in moving South Africa forward towards prosperity and a better life for all. And we offer many opportunities in return.

I wish you all successful sessions and deliberations over the next few days.

I thank you.

Issued by the Presidency, January 21 2015

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