SA prepares to put its best foot forward at next week’s BRICS summit
South Africa will aim to put its best foot forward in a bid to convince the BRICS member states that the country is open for business, thus hoping to attract investment into the infrastructure and manufacturing sectors.
This comes as the country hosts the 15th BRICS Summit in Joburg next week where government leaders, State-owned companies and private sector businesses from Brazil, Russia, India, China, and South Africa (BRICS) will discuss partnerships for mutually accelerated growth.
In preparation, the BRICS Business Council has held a number of stakeholder engagements with Working Groups from the South African Chapter.
Co-chair of the Infrastructure Working Group Zodwa Mbele on Friday said they wanted to share knowledge with BRICS member countries and industry experts to see how South Africa can benefit.
The BRICS Infrastructure Working Group is of the view that blended finance, a stable regulatory framework, and a generous rebates system is critical to bridge the infrastructure gap and accelerate development in South Africa, which could also be used to leverage the African Continental Free Trade Area (AfCFTA).
Mbele said they have realised that a number of infrastructure development projects are being stalled by the type of funding required, and that there is a huge gap in project preparation, even at pre-feasibility stages.
“Money is not a problem, by the way. Everyone wants to fund bankable projects, but how to bring projects to bankability, that's where the gap lies,” Mbele said.
“And no one is prepared to put money in that spectrum of the risk scale. So that's really the big part of it. The skills are not an issue, you can always import skills.
“I don't think that's a problem, but it's just to bring the project to bankability, where everyone else can access it for funding, which is now the big issue. I know that in our working group, skills transfer was mentioned, but it's not a big part.”
Meanwhile, chairperson of the BRICS Manufacturing Working Group Lesetja Mogoba said South Africa's manufacturing industry was well acknowledged for its prowess at a global level, its ability to be able to innovate and be novel.
Mogoba said if South Africa was able to leverage that, it was very likely that, with the right partners, it could be able to accomplish a level of scale that it was struggling to be able to achieve at the moment.
However, he said technology and decentralization should be at the forefront of this, as other BRICS nations have managed to increase their manufacturing capacity by aggressively adopting the fourth industrial revolution.
“We haven't been able to transition because there are some critical economic baselines that we still adhere to. For example, there is a position that needs to be taken that as you adopt new technology, it means that less people would be employed,” Mogoba said.
“However, if you look at the full bell curve of what should happen, if you incorporate this new technology that allows decentralization, at the same time it should be able to build on the gig economy, allow small entrepreneurs to be able to flourish, allow the youth to be able to sit at the table with some of the established institutions with this new technology.”
Mogoba said although the trade balance among BRICS countries was tipped in favour of China, there should be areas of complementarity between the nations to feed off each other and mutually benefit.
“In terms of complementarity, we have decided it works in our interest as BRICS to be able to improve our rate of innovation and our rate of commercialization on key projects where generally there would be a monopoly or an oligopoly on the global space,” he said.
“Our approach is that if we can establish our own products to service the majority of the populations in our nation, we can actually make a strong way forward.
“Because previously we have been blocked from being able to do so, because of the level of competition that actually exists. So by having a level of complementarity, we then share our skill set to be able to move these things forward.”
BUSINESS REPORT