Tech and telecoms companies, including Dimension Data, Google, Telkom and Teraco,pledged billions of rands towards supporting SA’s ICT sector, at the SA Investment Conference 2020 held yesterday.
Established in 2018, the annual investment conference provides a platform to showcase new investment opportunities in SA by attracting local and global leaders from business, government and the investment community to forge relationships and explore numerous ways to reignite economic growth in the country.
Addressing delegates during the opening address of the third edition of the SA Investment Conference held at the Sandton Convention Centre, president Cyril Ramaphosa announced the event had bagged a combined R109 billion in commitments from a total of 50 companies.
The collective pledges would bring the total amount of pledged investment to R773.6 billion worth of investments contributed towards SA’s economy in the last three years, he noted.
Some of the big commitments came from leading tech companies – Telkom pledged R8 billion to expand Telkom infrastructure across the country, and Google committed R2.2 billion in a fibre-optics submarine cable in the Western Cape that will provide high-speed Internet connectivity across SA.
In the data centre sector, Teraco Data Environments committed R4.4 billion, while NTT and Dimension Data pledged R875 million to expand their respective data centre infrastructure throughout Gauteng.
In the renewables energy sector, local solar power purchase agreement provider Sola Africa pledged R170 million in solar energy for large industrial power consumers, and solar tech solutions firm Sola Group contributed R400 million to the renewable sector across the country.
While this year’sR109 billion pledges were almost a third of 2019’s commitments, which amounted to R363 billion, the president pointed out this total amount would enable SA to reach 64% of its total target of R1.2 trillion.
“I am, therefore, immensely pleased to announce here today that we are firmly on track to meet our five-year target of $100 billion in new investments,” noted Ramaphosa.
“With this year’s conference taking place in an extremely subdued economic climate, securing investment commitments of over R100 billion is a remarkable achievement. Several of the investment commitments made at this conference are in sectors that have been hard-hit by COVID-19, especially the tourism and hospitality industries. These investments will go a long way towards their recovery.”
Resuscitating SA’s economy
Heeding Ramaphosa’s call and reassurance that SA is open for business, companies’ investments were spread across various sectors along the length and breadth of the country.
Additional pledges from firms operating in other sectors included Sasol, Pepsico, Sanlam, Industrial Development Corporation, Old Mutual,Equites and Sandvik,Frimax and the Belgian Chamber of Commerce.
COVID-19 has thrown a curveball at SA’s business sector in unanticipated ways, with the country’s economy taking a huge knock, which has seen business liquidations and the unemployment rate rising to 30.1%.
Ramaphosa noted SA is in the process of repositioning itself as a leading market for global business services, leveraging the country’s unique strengths in customer service, broadband infrastructure and expert skills, while building manufacturing capacity through the establishment of special economic zones and the revitalisation of industrial parks.
“These commitments are much more than statements of intent. These commitments are a form of compact between companies, their shareholders and their stakeholders,” continued Ramaphosa.
“As we have seen, these commitments do actually translate into new and improved facilities, expanding production, creating employment and opening up new markets.”
Ramaphosa noted the commitments were a testament not only to the resilience of SA’s economy, but also the huge potential that investors see in it.
Making good on 2019 pledges
A large part of this year’s conference focused on an update on the implementation of investment commitments made during the 2018 and 2019 editions of the SA Investment Conference.
Last year, mobile operator MTN and Naspers were among the firms that made commitments to invest in SA.MTN committed to invest R50 billion towards infrastructure that will enable a series of digital and financial inclusion initiatives across SA over the next five years, while Naspers reaffirmed the company’s commitment made in 2018 to drive more investments in backing South African tech companies.
Speaking at a roundtable discussion at the conference, Phuthi Mahanyele-Dabengwa, CEO of Naspers South Africa, provided an outline of Naspers’s achievements since its previous pledges at the same conference.
In 2018, Naspers committed to invest a total of R4.6 billion, which includes the R1.4 billion for its investment fund, Naspers Foundry. The group has so far invested R1.9 billion of its original pledge in its existing South African businesses Takealot, Mr D Food, Superbalist, Media24 and OLX, agri-tech business Aerobotics and online marketplace Food Supply Network.
“Whilst SA is going through a difficult economic period, the reality is that the impact of these investments is there. In 2019, Naspers Foundry invested R30 million in online home cleaning services business SweepSouth, which has grown from having employed 15 000 home-cleaners to 20 000 today,” said Mahanyele-Dabengwa.
“This shows the extent to which there is so much commitment to economic growth in SA, which is focused not only on the large companies, but also in founders of these small businesses who are highly educated and are looking to make a difference in the lives of ordinary South Africans. So this is something that is critical for us as Naspers.”
Mahanyele-Dabengwa also announced Naspers’s latest R45 million investments in online learning platform The Student Hub,as the tech giant sets its sights on SA’s burgeoning edtech sector.
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