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US Firms in Africa - Business Confidence Up

Published date:
Tuesday, 29 July 2003

US companies operating in SA are adopting a more favourable outlook on local domestic investment, a survey conducted in June by the American Chamber of Commerce has revealed.

Of the more than 80 members of the chamber who responded to the annual survey, more than half indicated that the economic climate in SA was either excellent or good, with 40% reporting it as variable.

Only 5% which the chamber's executive director, Luanne Grant, said was an "encouraging sign" said that the economic climate was poor, compared with 28%in last year's survey.

Another encouraging trend, said Grant, was that 41% of SA-based US companies responding to the survey, said they planned to invest more in the coming year.

More than a third of the companies, or 36%, have unchanged investment plans and only 14% said they planned to invest less.

The survey also showed that in the past year the number of members that have increased confidence in government's ability to improve local business environment has tripled.

Chamber member companies, whose interests span a broad spectrum of business sectors in SA, are estimated to employ more than 125000 people and are involved in community projects worth R1,5bn, with a major part of this spending going on education, health and skills training.

Factors that encouraged local investment most were a stable and healthy economy, and a stable government.

Other factors cited were the low cost of labour as a result of rand values and of doing business generally; the excellent SA business infrastructure; and the future business potential of SA.

Five local key issues emerged as potential barriers to investment relative to investment in other countries. These were business crime and personal security matters; overregulation applying to black economic empowerment equity; exchange control; and labour issues.

The chamber's president, Phillipe Bovay, said the organisation would be happy to discuss the survey results with government, together with other feedback issues, "as part of the chamber's continuing effort to help develop policies that will further progress economic prosperity and investment in SA".

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