As a multi-faceted economic destination, South Africa has developed a unique trading environment specifically attractive to foreign investors. This is evidenced by the fact that South Africa has been dubbed Africa’s powerhouse with a Gross Domestic Product (GDP) in excess of R2.3 trillion – which constitutes 30% of the continent’s GDP, and is four times that of its African neighbouring countries. Not only has South Africa displayed fortitude with its sophisticated financial systems during the economic recession, it has showcased a promising emerging market portfolio in recent years, being ranked 53rd out of 148 nations internationally according to The World Economic Forum’s Global Competitiveness Report 2013-14. South Africa has also been ranked 41st out of 189 economies according to The World Bank’s Report: Doing Business 2014 for the ease of which business can be conducted – a welcoming assurance for any party wanting to enter this bustling business landscape.

Opportunities exist for EU companies particularly, in emerging trade in services and the green economy. Due to well-developed capital markets, South Africa has a strong services sector that has brought significant foreign direct investment (FDI) into the country. South Africa is also competitive in entrenching its presence in this sector in the region. The EU is strong in trade in services and the growth in opportunities provides an entry into this sector.

Other reasons to consider doing business in South Africa: 

  • Political and economic stability as its government has achieved in the face of macro-economic instability through strategic domestic competitiveness, growth and employment policies
  • Its ability to meet key trade and investment milestones for its investors and prospective investors
  • Extensive, modern and reliable transport infrastructure unlike any other African country
  • World-class and highly-regulated financial systems
  • Top-drawer research and development facilities – boasting more patents by foreign companies than any other country in Eastern Europe or on the African continent
  • Low interest rates
  • Access to inter-continental and East-West trade markets as South Africa serves as a trans-shipment point
  • Assistance and incentives for producing goods and rendering services in the country
  • Johannesburg Stock Exchange (JSE) is among the top 20 exchanges in the world by market capitalisation
  • Sophisticated telecommunications infrastructure
  • Favourable cost of doing business ensures high standard of living supported by energy costs that are still among the lowest in the world

From the World Economic Forum’s Global Competitiveness Report 2013-14, achievements to date include:

  • Ranked first in the strength of auditing and reporting standards
  • Ranked second in the efficacy of corporate brands
  • Ranked third in the protection of minority shareholders’ interests
  • Ranked seventh in the effectiveness of anti-monopoly policies
  • Ranked second in the availability of financial services
  • Ranked second in the financing through the local equities market
  • Ranked third in the soundness of banks
  • Ranked first in the regulation of securities exchange
  • Top ranking for legal rights index
  • South Africa’s 53rd overall ranking is sub-Saharan Africa’s highest
  • South Africa is second only to China among the Brazil-Russia-India-China-South Africa (BRICS) economic grouping
  • South Africa’s absolute score remained at 4.4 on a scale of 1 to 7

South Africa’s potential is evident by the diversity of its industries underpinned by a strong economy. The strong economy is backed by innovative technologies, transport infrastructure, world-class financial services and an emerging creative industry. These sectors are resourced by an extensive base of a professional and highly-skilled labour force. The South African government continually introduces new initiatives for further training and development, with a view to fast-track this already burgeoning economic landscape.

The country’s resources have also demonstrated an ability to out-perform some global counterparts in the following areas:

  • Country size: 25th in the world by total area according to the CIA World Factbook 2013
  • Foreign exchange reserves: 37th out of 100 according to the IMF 2013
  • Most democratic: Ranked 44th out of 150 countries according to the World Audit Survey 2013
  • Size of gold reserves: 29th out of 100 countries according to the World Gold Council 2013
  • Protection of investors: 10th out of 183 countries according to the World Bank Doing Business Report 2014
  • Size of exports: 39th out of 192 countries according to the CIA World Factbook 2013
  • Agricultural output: In the world’s top 20 according to the FAO
  • Press freedom: 41 out of 176 countries according to the World Audit Survey 2013 (higher than France, Italy, Spain, Portugal)
  • “Big Mac” index of January 2014: 22nd out of 56 countries
  • Railroad network: World’s 11th longest according to the International Union of Railways data
  • Road network: World’s 19th biggest according to the CIA World Factbook
  • Electricity production: World’s 16th biggest producer according to according to the CIA World Factbook
  • Budget: South Africa’s Open Budget Index score in 2012 was 90 out of 100, the 2nd highest score of the all the countries surveyed
  • Nation brand: The most valuable on the continent in 2011 according to UK-based Brand Finance
  • Tourism: South Africa ranks 24th in terms of tourist arrivals according to the UNWTO
  • Corruption: The 55th least corrupt nation according to the World Audit Survey 2013