As the most developed, diversified and competitive economy in the African continent and a member of the world’s leading emerging economies (BRICS), South Africa is a very interesting market with 50 million inhabitants, a per capita income of USD 6,000 and political stability, which can offer great business and investment opportunities to foreign companies. The Ministry of Industry, Economy and Competitiveness considers it a priority market. In fact, it has designed a specific Integral Market Development Plan (PIDM) to promote the presence of Spanish companies in that country.
South Africa is the main market for sub-Saharan Africa in Spain. In 2016, he ranked 37th as a customer in Spain. Spanish exports have been declining since the beginning of the recent economic crisis and began an upward trend in the period 2010-2013. However, this trend was interrupted in 2014 and currently stands at levels below the maximum of 1,420 million euros reached in 2013. As for the Spanish products exported to that country in 2016, stand out the cars and tractors (24 per cent), machinery and mechanical appliances (8 per cent) and fats and oils of vegetable or animal origin (7 per cent).
Spanish investments in South Africa are limited and their volume is very similar to the investment received. In 2016 it reached 7 million euros, much lower compared to 25 million in 2014. Spain was the thirteenth investor in South Africa. South African investments in Spain are also scarce and fluctuating. In 2016 they reached 11 million euros, surpassing the investment received from Spain.
Renewable energies are one of the sectors that offer the greatest opportunities to Spanish companies, both in related services and in equipment. There are energy policy programs that will favour their development, opening up possibilities of participation for our companies. The automotive sector is also an attractive sector for foreign investment, as evidenced by the recent investments made in this country by European automotive companies.
There are important opportunities in rail transport and in the development of port facilities, with outstanding public investment plans.
In the hydrological infrastructure sector, plans are expected to be made to invest in reservoirs, desalination plants and water treatment in which Spanish companies may have options to participate. South Africa is in a process of renewal of infrastructure and transport, with several projects in progress that will require the experience of foreign investors.
Though in a small segment of consumers, in South Africa there is demand for luxury products and good quality that can also take advantage of Spanish companies in the sector.
The primary sector, highly developed in the country, generates a high demand for machinery and intermediate industrial products.The tourism sector also presents interesting investment opportunities in South Africa, where this activity is undergoing remarkable development.