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President Cyril Ramaphosa said he’s been "overwhelmed" by the level of interest in an investment summit he opened on Friday and that his plans to lure $100bn over the next five years are well ahead of target.
With elections due to take place next year, Ramaphosa needs to show he’s delivering on pledges to revive an economy mired in recession and create jobs for the 27% of the workforce that’s unemployed. Since announcing the investment drive in April, China, the UK, the UAE, Saudi Arabia and Daimler’s Mercedes-Benz unit have pledged $35.5bn (approx R517bn).
Companies pledged to invest more than $8bn (approx R116bn) on Friday, including a $6bn (approx R87bn) commitment from Anglo American, although not all the money is new. Further announcements are expected later in the day.
"We are making enormous progress," Ramaphosa said in an interview with Bloomberg Television at the investment conference in Johannesburg, which attracted more than 1 000 delegates. "I think we are ahead of the track, we are way ahead, and I am overwhelmed by the level of interest in the South African economy."
Gloomy outlook
The summit comes two days after Finance Minister Tito Mboweni unveiled a mid-term budget that slashed economic growth forecasts and showed government debt peaking later and at higher levels than previously anticipated. The gloomy outlook triggered a sell-off in the rand and the nation’s bonds, and raised fears the country could lose its sole investment-grade credit rating from Moody’s Investors Service.
"After this, things get better because we know we are able to wrap our arms around what needs to be done," said Ramaphosa, who expressed confidence that another ratings downgrade could be avoided. "We are repositioning our economy and beyond this, I am confident that we will have done a pretty good job to put South Africa on a winning path once again."
Ramaphosa, a 65-year-old lawyer and former labor-union leader, took office in February, after the ruling party forced Jacob Zuma to step down following an almost nine-year tenure that was marred by scandal, policy missteps and inappropriate appointments.
"We now know how serious and how deep the problem was," Ramaphosa said. "We now know what needs to be corrected. We now know the type of skills that we need and the type of people that we have to put in place to repair the damage that has been done in the past nine years, and it is huge damage, but we are repairing it."
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