A lack of investment remains the biggest challenge facing South Africa’s recession-hit economy, Finance Minister Nhlanhla Nene said on Wednesday.
Closing a debate in the National Assembly on the how to mitigate the recession, Nene stressed the need for policy certainty in order to reassure potential investors.
“Our main challenge remains a low investment,” Nene said, adding that it was imperative that government held out policy certainty so that investors would “feel confident enough to invest and spend”.
“Government must build a pipeline of investment opportunities,” he said.
He said the energy sector was an example of how ending years of policy uncertainty could make a positive impact and called for this example to be replicated in other sectors.
The dismissed a suggestion from the Freedom Front Plus (FFPlus) that the government’s plans to amend the Constitution to facilitate expropriation without compensation were a deterrent to foreign investment.
Asked bluntly by the FFPlus’s Corne Mulder whether he would, if he were an investor, put money into a country facing this policy development, Nene pointed out that the racial inequality reflected in land ownership statistics was in itself the consequence of the seizure of black-owned land without compensation a century ago.
“I would invest in a country that is beginning to reverse those things that happened over years,” he said.
Earlier, Democratic Alliance finance spokesman David Maynier accused President Cyril Ramaphosa of squandering the goodwill the markets had shown South Africa after he replaced Jacob Zuma earlier this year.
He said Ramaphosa had allowed populism to destroy the prospect of economic revival.
“Big business is experiencing buyers remorse because they are not getting what they paid for… Cyril Ramaphosa is a man without a plan to fix the economy.”
Better policies will see rapid inflows of foreign direct investment into the country to better the economic performance of the nation.