The Western Cape has proved to be an extremely resilient destination, despite the ongoing challenges it faces amidst a global economic downturn.James Milne, Wesgro head of investment promotion, says evidence of this was the province’s ability to weather the challenges of the recent prolonged drought.“The region is proving to be an increasingly attractive destination for investors seeking a future-oriented, well-governed location that can be used as a base for growing operations across the continent,” he told Freight News. “Sectors such as the green and digital economies are witnessing rapid growth, while traditional stronghold sectors such as agribusiness and finance are benefiting from crossover exposure that has led to the evolution of exciting AgriTech and FinTech sub-sectors.”He said the coronavirus pandemic had had a significant negative impact on both trade and investment, primarily as a result of lockdowns implemented both locally and globally. “Lockdowns have increased uncertainty from an export perspective in terms of value chain disruptions and legal restrictions.”From an investment perspective, the United Nations Conference on Trade and Development (Unctad) has projected that global foreign direct investment (FDI) flows are likely to decrease by 40-50% year-on-year. “The Western Cape has been hard hit, as restrictions linked to the pandemic have affected key industries such as hospitality and tourism. In the very short term, our biggest challenge to attracting investment will relate to lockdown restrictions and border closures, which have affected the ability of investors to visit the region and conduct due diligence on potential investments. However, this challenge is likely to be mitigated as the virus risk is reduced.”Milne said dealing with investor perceptions of South Africa as a whole was also a challenge for the province.
