According to the survey carried out by The Economist Intelligence Unit, South Africa is rated exceptionally high, an important reason for this is that the country’s exchange rate has stabilized strongly against other currencies; particularly as the living standards and first world infrastructure in the nation has increased.
Although the currency has strengthened against the major currency in years, the rand exchange rate makes real estate, restaurants and quality hotels cheap by world standards, also the nation’s energy prices are among the lowest in the world. Eskom provides electricity to most of Africa and is known for its supply quality that is exceptional.
South Africa’s unit labour costs are considerably lower than those of emerging markets, including Hungary Mexico, Malaysia and Singapore. Also, over the years, the country has experienced a surge in labour productivity. South Africa has global labour legislation in place, hence, there is a decline in the number of person and days lost due to industrial actions and facilitating labour relationships.
South Africa’s corporate tax rate – down to 29% for 2005/06 – compares favourably against a number of developing companies, with high prospects of further reductions.
Ease of conducting business in South Africa:
Based on a 2005 World Bank report, South Africa is among the top 30 nations in the world for ease of conducting business. The finding indicates that South Africa is making progress in creating an environment conducive for investment, which the government has identified as key to achieving a 6% growth rate in the economy. The survey ranked 155 nations in accordance with the number of procedures, time and costs involved in starting a company, dealing with governments and institution in obtaining licences, hiring and firing workers, registering property, getting credit, security for investors, paying taxes, trading across borders, enforcing contracts, and closing a company.
South Africa ranked 28th, ahead of Spain, Austria, France, Russia, China and Brazil. Overall, SA had the highest ease-of company ranking on the African continent.
Industrial capability, cutting edge technology:
South Africa’s industrial production growth is well above the average for developing markets. The country’s manufacturing output is becoming more and more technology intensive, with high technology manufacturing sectors – like machinery, scientific equipment and motor vehicles – enjoying a growing share of total manufacturing production since 1994. Suffice to say, SA’s technological research and quality criteria are internationally renowned.