European Investors Thinking Twice About Coming to South Africa Because of the ANC and Eskom's Power Shortages

European Investors Thinking Twice About Coming to South Africa Because of the ANC and Eskom's Power Shortages

  • European businesses in South Africa have lost confidence in the country due to the continuous power shortages, corruption and the ANC-led government's inefficiencies
  • A recent survey revealed that although EU companies still regard the country as more business-friendly than other African and Asian countries, they are being put off by many factors
  • According to reports, the July unrest and COVID-19 pandemic are also some of the factors that are making investors pull away from the country

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European companies in South Africa are not certain about reinvesting in the country due to a number of factors. A recent survey conducted showed that foreign investors are being put off by the continuous power shortages, corruption and government inefficiences.

The EU provides the largest share of the country's FDI employing an estimated 350 000 locals, way ahead of the United States of America, China and the United Kingdom.

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ANC, South Africa, European Union
European Investors who want to invest in the country are being put off by factors such as corruption and power outages. Image: Getty Images
Source: Getty Images

According to Business Insider, a recent study by the EU Chamber of Commerce and Industry of Southern Africa proved that over 300 EU countries that are yet to invest in the country considers it favourable and business-friendly. This is due to factors such as the abundance of cheap labour, raw materials and good infrastructure makes the South Africa better than countries such as Brazil, Malaysia and China.

However, some companies pointed out that there are some factors that are decreasing investor confidence, reports IOL News. Per the publication, these investors pointed out corruption, transport infrastructure and a volatile political climate as some of the reasons they are thinking twice about investing in the country.

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The civil unrest of July 2021 which cost the economy over 50 billion Rand and thousands of jobs. The report further states that the unrest had more impacts than the COVID-19 pandemic.

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The news has been met with mixed reactions by South African social media users. Some said it will give local investors a chance.

@KhulekaniLuth10 said:

"Tell those investor to futseg we are tired of exploiters masquerade as investor....we will invest with our skill till we own our economy."

@Glendalina_gp added:

"There are brilliant investment opportunities in this country, we could literally be a gold mine, no pun intended. No problem with the limitless opportunities with the country, we just have a corrupt, inefficient government. Just look at how world class our private sector is."

@khulani_nyokana commented:

"This is so sad and people in South Africa really cannot get over the history Europe has for Africa so they throw away opportunities to get government to do such things like getting investment from wealthy places."

KZN Floods: Premier Sihle Zikalala says more than R17 billion is needed to recover from April and May floods

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Briefly News previously reported that the KwaZulu-Natal government has submitted an application to the National Disaster Management Centre for at least R17.8 billion in flood relief funds.

The application comes after parts of the province were ravaged by torrential rains that resulted in floods that destroyed public infrastructure and homes and caused the loss of many lives.

Speaking to the media over the weekend, KZN Premier Sihle Zikalala stated that rebuilding the damage caused by the April and May floods cost close to R25 billion, reports SABC News.

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Source: Briefly News

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