South African Business 2017 edition

SPECIAL FEATURE
upgrading and standardisation of facilities at ports,
railway lines, customs posts and energy projects.
South African rail, ports and pipeline operator
Transnet is already active in African countries north
of the South African border, and is intending to offer
its services more widely.
This is part of Transnet's Market Demand Strategy
(MDS), which seeks to grow the business by responding
to the market. Instead of simply making rail wagons
for Transnet Freight Rail, the broader strategy
looks for new customers (elsewhere in Africa, or in
India, China or Australia) where rail wagons can be
sold.
Transnet Engineering's own Trans-
Africa Locomotive (for branch lines and shunting
yards) is being marketed to other African countries
and mining companies.
Another strand of the MDS is evident in
Transnet Engineering planning to set up Maintenance
Repair and Operations (MRO) centres in four African
countries. Transnet Ports Authority might similarly
offer its expertise in running harbours and logistics
to countries in the corridor.
The Sustainable Development Investment
Partnership (SDIP) comprises 30 institutions that
aim to see 16 African infrastructure projects (valued
at more than $20-billion) carried out. The founders
of the SDIP were the World Economic Forum (WEF)
and the Organisation for Economic Co-operation
and Development (OECD) and other members
now include the Bill and Melinda Gates Foundation,
the Senegal Strategic Investment Fund (FONSIS),
US Agency for International Development (USAID),
the Industrial Development Corporation of South
Africa (IDC) and the Development Bank of Southern
Africa (DBSA).
The DBSA is concentrating on energy, transport
and bulk water projects in its area and has plans to
increase its investments to about R20-billion in the
short term. The focus of organisations such as the
DBSA is on infrastructure, and this will have a positive
spin-off for trade of all kinds, through improved
ports and roads, and healthier populations in rural
and urban areas.
China has pledged to support the rehabilitation
of the railway line between Zambia and Tanzania
while the Industrial and Commercial Bank of China
is to invest R20-billion in renewable energy in Africa.
Lack of reliable power supply is a constraint to trade
so this and other ventures in the power sector will
help to foster trade.
The South African Department of Trade and
Industry (dti) plays a key role in terms of promoting
trade between South Africa and the rest of Africa, but
also supports regional bodies such as SADC and promotes
the kind of integration contained in the plans
of the New Partnership for Africa’s Development
(NEPAD) and the African Union’s Agenda 2063.
During 2016 the dti launched the Trade Invest
Africa initiative to coordinate and implement South
Africa's economic strategy for Africa. By working
with the private sector, government hopes to take
advantage of export and investment opportunities
on the continent.
The Export Credit Insurance Corporation of South
Africa (ECIC) exists to help trade and investment
across borders. The ECIC can provide insurance for
bank loans that are taken by investors and South
Africans can get insurance for investments and for
small and medium enterprises there is a product
available (performance bonds) to anyone exporting
capital goods and services.
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SOUTH AFRICAN BUSINESS 2017