SOUTH AFRICA

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SOUTH AFRICA OPEN FOR BUSINESS
BUSINESS OPPORTUNITIES

Tumelo Nkoane 11 July 2007 emita
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PRESENTATION OUTLINE

• Macro-economic Trends
• Gateway to Africa
• Sectoral Opportunities

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Key Messages

• South Africa has a stable macro economic
  environment, a strong fiscal position and a range
  of growing sectors from this platform SA is
  gearing for accelerated growth
• SA is a springboard for companies wanting to do
  business in Africa

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Economic Growth
Growth has averaged 4 per annum in the past four
years and is projected to increase to 5 for the
coming four years.
Real growth in Gross Domestic Product (GDP)
South Africa has experienced 85 months of
continuous growth.
Macro-economic Trends
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Macro-economic Trends
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Macro-economic Trends
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Macro-economic Trends
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Macro-economic Trends
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Economic Structure

• South Africas economy has diversified away from
  primary commodities

Contribution to National GDP
Tertiary sector
Secondary sector (incl Manufacturing)
share
Primary sector (Agriculture and Mining)
December
Source SARB
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Gearing for Growth

• Focus Areas of the Strategy
• Increased macro-economic stability
• Increased investment in economic infrastructure
• Sector investment strategies
• Development of skilled labour
• Strengthening the 2nd economy
• Improvement in state organisation and capacity

Macro-economic Trends
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The Gateway into Africa

• 6 of Africas Population
• 18 of Africas GDP
• 45 of Africas mineral production
• 50 of Africas purchasing power
• Dynamic force in SADC
• Driving force in NEPAD
• Extensive road rail infrastructure which
  connects with Sub-Saharan Africa
• Telecoms infrastructure with world-class
  connectivity and uptime

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OUR LOCATION
STRATEGIC GEOGRAPHIC POSITION TO GLOBAL SHIPPING
ROUTES
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Business Processing and Outsourcing IT Enabled
Services

• Call Centres
• Back Office Processing
• Shared Corporate Services
• Enterprise solutions in e.g. fleet management,
  knowledge management asset management
• Value Proposition
• SA offers high quality, low cost destination for
  BPO in stable investment environment supported by
  world class infrastructure
• Cultural and product affinity with the UK and
  Europe
• Public sector commitment made long-term
  commitment to this sector, so strong investor
  support sustainable reduction in costs over the
  next few years
• Business Opportunities

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• Tourism
• Hotels self-catering holiday resorts
• Adventure, eco-, sport-, conference cultural
  tourism
• Infrastructure development
• Leisure complexes world class golf courses
• Harbour waterfront developments
• Transfrontier conservation
• Competitive Advantage
• SAs fastest growing industry
• 2010 Football World Cup

Business Opportunities
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Agro-processing
Business Opportunities
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• Automotives components
• Vehicle interiors e.g. natural fibre interior
• Engine parts/components
• Electronic drive chain components
• Body parts e.g. lights, painted plastic
  components, airbags, glass wire products,
• Aluminium components
• Wheels (steel aluminium)
• Catalytic converters
• Plastic tool die manufacturing
• Competitive Advantages
• Access to aluminium steel
• Removal of tariffs into EU
• Competitive tooling costs

Business Opportunities
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Chemical allied Industries

• Competitive Advantage
• Abundant mineral feedstock for inorganic
  chemical manufacturing
• Abundance of agricultural raw materials (sugar,
  molasses, essential oils lavender khakhi-bush
  lemon grass)

Business Opportunities
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Clothing, textile footwear

• Large-scale manufacturing of industrial textiles
  using polyester
• Wool mohair production downstream
  opportunities for yarns, knitwear fabric
• Manufacturing of leather uppers
• Competitive Advantage
• Worlds largest producer of mohair
• Raw materials to produce any type of leather
  footwear bovine ostrich crocodile game
  leather

Business Opportunities
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• Electro-technical industries
• Manufacturing automotive electronics
• Manufacture PC boards for automotive sector
• Upgrading existing microchip manufacturing
• Upgrading existing telecoms equipment
• Power line communications (PLC)
• Niche software engineering
• Opportunities in defence related electronics
• Expansion in pre-payment metering technologies
• Partnering for infrastructure (utilities)
  related projects in Africa
• Competitive Edge
• Leading the world in prepayment technology and
  standards
• Piloting new innovations

Business Opportunities
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Mining metal-based industries

• Downstream processing value adding of iron,
  carbon steel, aluminium platinum group metals
• Aluminium smelting
• Casting forgings
• Ferro-alloys
• Stainless steel production e.g. stainless steel
  wire
• Manganese metal production castings
• Gold chain manufacturing handmade jewellery
• Comparative Advantage
• Large aluminium steel resources
• Worlds largest deposits of platinum group metals

Business Opportunities
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Aerospace

• Aviation related services, including
  maintenance, repair and overhaul
• Rotary and fixed wing components
• Aviation training services
• Specialised manufacturing of avionics, including
  health usage monitoring systems
• Satellite related services (including tracking
  and control and applications development)
• Rail
• Production of infrastructure (tracks,
  signalling, electrification)
• Manufacturing of rolling stock components
• Manufacturing of mining rail equipment
• Maintenance (infrastructure rolling stock) RD
• Marine
• Manufacturing assembly of engines gearbox
• Manufacturing of mechanical components

• RD

Business Opportunities
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Capital Equipment

• Competitive Advantage
• Access to steel, aluminium
• Competitive costs
• Engineering technology

Business Opportunities
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• Film
• Film studio production
• Co-production ventures
• Distribution infrastructure
• Servicing foreign productions
• Comparative Advantages
• Co-production treaty with UK
• Film rebate scheme

Business Opportunities
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• Conclusion
• South Africa offers compelling business
  opportunities, with stable macro-economic
  environment, strong fiscal position and a clear
  growth strategy based on building on comparative
  advantages and removing constraints

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THANK YOU
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CONTACT US
SOUTH AFRICAN HIGH COMMISSION TRAFALGAR
SQUARE WC2N 5DP LONDON PH. 020 7451 7237 FAX.
020 7839 0634 EMAIL. london_at_thedti.gov.za