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Strikes won't perturb UK investors

Oct 11 2012 16:18 Sapa

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Cape Town - Serious investors would not be put off by labour unrest in the mining sector, visiting United Kingdom business secretary Vincent Cable said on Thursday.

"Major UK investors have pointed out that they are not fazed by some of the recent developments like the strikes around the mining industry, the tragic events," he said after meeting Trade and Industry Minister Rob Davies in Cape Town.

"South Africa has got a lot of fundamentals attractive to investors and their perspective has not been altered by what's been happening recently."

Cable said Britain had the largest stock of private investment in South Africa and recent events would not change that.

Investors understood there were deep social economic problems which originated from the apartheid era and that these needed to be dealt with sensitively.

Cable said there was no need to attach too much importance to "short term events".

He said while the value of investments in South Africa had slowed down, the number of projects being invested in was increasing rapidly.

"Instead of capital intensive projects in mining, you [are] getting a lot of IT and service-based investments... so the overall investment climate remains positive."

Cable moved to re-assure investors that South Africa's investment regime was a good one.

"The assessment of serious investors is that South Africa is an open economy and it approaches foreign investment in a positive and welcoming way."

Davies concurred, although he expressed concern about South Africa's downgrading by international rating agencies.

He sought to assure Cable that the government was dealing with both the causes and consequences of unrest at mines which had led to the international headline-topping Marikana tragedy in August.

"A lot of work is going on in government to address underlying factors and rebuild confidence in the labour relations regime in the country," said Davies.

He said many business people around the world were not taking a dim view and recognised that Africa was the next growth frontier.

"The prospects here are extremely bright, and it's very necessary for companies who want to be part of that prosperity that's going to unfold on [the] continent to continue investing in South Africa."
mining unrest  |  investors  |  strikes  |  sa economy
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