SA switches from gateway to gatekeeper

South Africa has become

more of a “gatekeeper” than

a gateway to Africa and the

foreign investment community

has noticed, according to a

policy and regulation analyst.

“Foreign investors, already

skittish because of policy

issues and new regulations,

are beginning to express

concern about South Africa’s

gateway status,” said Peter

Draper, director of Tutwa

Consulting and senior research

fellow in the Economic

Diplomacy programme at the

South African Institute of

International Affairs.

Speaking at a high-profile

business debate about trade

and foreign investment in

SA – hosted by the Gauteng

Growth and Development

Agency (GGDA) at its offices

in Sandton earlier this month

– Draper pointed out that the

promulgation of legislation

such as the private security

bill and the expropriation

bill created the impression

that SA was not an attractive

investment destination.

“One of the things we have

going for us is our status

as a gateway into the rest

of the continent due to our

established infrastructure

(compared to the rest of Africa)

and world-class logistics

services, but that is rapidly

changing as our neighbours

catch up on their infrastructure

deficit and start wooing global

investors with far more relaxed

foreign direct investment (FDI)

policies,” said Draper.

As a result of neighbouring

countries pouring billions

of dollars into trade and

logistics infrastructure

development – ports, roads,

rail etc – other gateways are

emerging, including Kenya

into East Africa, Mozambique

into southern Africa and even

Angola in the near future.

“And these countries are

located closer to the traditional

markets such as Europe

and the United States, that

remain SA’s biggest investors,”

commented Draper.

He believes South Africa

still has a limited window of

opportunity to retain its status

but noted that the country

needed to get its gateway

proposition right to move up

the global trade value chain.