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This interview was originally aired on RSG Geldsake (in English, with an Afrikaans introduction that has been translated here).
RYK VAN NIEKERK: Yesterday there were reports in the media that French companies have paused all investments in South Africa due owing to the government’s inability to address many structural problems. There are more than 400 French companies doing business in South Africa, including TotalEnergies, Air France, Air Liquide, BNP Paribas, Mazars, Danone, Leroy Merlin and L’Oréal. These companies have collectively invested more than R70 billion in South Africa since 2019, and they also employ around 70 000 people. France is also South Africa’s second-largest trading partner in the European Union. Germany is the largest.
Sébastien de Place is on the line. He’s the president of the Foreign Trade Advisors for France in South Africa, and he’s also a partner at Mazars. Sébastien, thank you so much for your time. Please explain your position.
SÉBASTIEN DE PLACE: I’m very happy to have this clarification with you. As you say, yesterday was a little bit surprising for me as well, to be honest with you. I will explain a little more. You said R70 billion has been invested. It’s the amount that was committed at the investment conference four years ago, for the following five years. I’m very happy to share with you that the R70 billion has been invested in four years, and we are ready to continue to invest – and, more importantly, we are ready to commit to an additional number of investments.
My point yesterday was to say that in order to give a new amount of commitment – not investment but an amount of commitment – there are a few issues that foreign investors have in the country; not only the French. And these few issues are actually at the moment in discussion with the South African government.
One of them is the visa for foreigners. One of them is electricity. Obviously we have logistics, transport and education. But for each of these issues we have at the moment discussions with the government and the different ministers. So French companies are ready to invest, and they will continue to invest.
When it come to giving you a number now for the following years, we are waiting to see where these discussions go. We are waiting to see concrete actions coming, and we are positive they will come.
If you take the topic of the visa, we employ, as you say, 70 000 South African employees in the country. We have a few hundred expats. You can imagine that expats are important when you invest in a country; you want your CEO, you want the head of a factory, you want people to be able to train your team if they are coming from your head country.
And for these few hundred visas we have difficulties today – not only us but all foreign investors. Some application visas can take a few weeks, some can take from one to two years, and we are trying to resolve this issue with the government. Again, we are positive about the country, we are positive these issues will be resolved. Now we will see that an application of visa takes an amount of time that is the same every time, and we get the few visas that we are asking for. Certainly we will be happy to communicate on the new number. But I was talking about number and not talking about continuing to invest.
RYK VAN NIEKERK: So that is a pledge for future investments. You don’t want to disclose that number because that is vastly different from stating that you are pausing investments. Is that correct?
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SÉBASTIEN DE PLACE: Absolutely Ryk. It’s absolutely correct and it was certainly a miscommunication that happened yesterday. But you are right in saying there are still investments coming from France, and South Africa is still for French companies a country where investments won*…… 3:42 [might be *weren’t ’???] successful but they still want to continue to invest. Absolutely, yes.
RYK VAN NIEKERK: How would you describe the relationship between the foreign trade advisors for France and the South African government?
SÉBASTIEN DE PLACE: I think the relationships at the moment are good. We are in contact, as I said, and it’s important for us to know that we have ministers or directors at the South Africa government that are listening to issues and that are telling us they’re working on issues. So I would say the relationship is today very positive and that’s the reason why it was important to correct the fact [to state] that we are still investing. We are happy about the discussions in progress. I can tell you that many more investments are coming, again in terms of how much; we ‘ll just wait to see what is happening with electricity, with visas and logistics.
RYK VAN NIEKERK: But, even if it relates only to the pledges for future investments, that statement is significant, because we’ve seen the problems with the visas for many years. We have also been experiencing electricity and logistical challenges for many years, and they are actually quite bad at the moment. Have you seen an improvement over the past few years, because we’ve heard the rhetoric that ‘government is working on implementing change’, but it doesn’t seem to happen.
SÉBASTIEN DE PLACE: Yes, absolutely. So it is important to say the improvement on some of the topics – yes, if you take the visa issue, it’s been a few years that we have been raising that problem. But we never had discussions in the past and in the last three months. We were speaking to deputy president Paul Mashatile a few months ago where we put in place a working group, where we said, ‘What exactly would you like on the visa?’ And you can even see that the South African government is trying a new type of visa.
Just to explain what it’ll be about, it’s a type of investment visa where, if you come to the country with a certain amount of investment, you’ll be able to decide that you need a certain number of foreigners in the country, and the visa application will be easier for this. That potential new rule is being tested at the moment; it has started a month ago. So yes, we see improvement.
About energy – we all know that we have load shedding today. Load shedding is not less than it was last year, but there is a plan in the country. There is a plan to say we want to reduce load shedding in the next two years. So again, coming back to my statement, if in six months we still continue to say ‘we need two more years’, then we will start to have an issue. But today the two-year plan is in progress. It’s been two or three months since our minister of electricity explained the plan and today there is nothing to say that in two years we’ll still have load shedding. We have to wait a little bit and we want to see concrete actions. And this is exactly the statement that I’m sharing.
RYK VAN NIEKERK: Thank you Sébastien. That was Sébastien de Place. He’s the president of the Foreign Trade Advisors for France in South Africa and also a partner at Mazars.
