AFRICAN INTEGRATION DREAM: Government smooths path for business
by Larry Claasen ,
2014-11-20 07:01:50.0
AFRICAN countries do not trade with each other very much. Even decades after becoming independent states, African countries tend to trade more with their former colonial masters than with their neighbours. The NDP is looking to change this by providing an array of incentives to get South African businesses to do more cross-border transactions.
Though offering incentives like paying for exhibition space has some part to play in getting local firms to set up shop abroad, Yaw Keteku, associate partner at Vantage Capital, points out that the biggest difference government has made was in prodding state-aligned institutions such as the Development Bank of SA and the pension funds of parastatals to invest. Without the backing of these state-aligned institutions, Keteku says it would have been difficult for Vantage Capital to raise R330m in funding for the expansion of Surfline’s 4G LTE network in Ghana.
Surfline was the 11th mezzanine transaction in Vantage Capital’s second fund, of which more than 80% of available funds have been invested. Vantage has commenced the raising of its third mezzanine fund, which is targeted to close by the first quarter of 2015, at $250m — R2,75bn.
The South African government has made growing stronger relations with Ghana a priority. Elizabeth Thabethe, while then still trade and industry deputy minister, said last year that both parties were looking to fast-track an economic and technical co-operation agreement signed in 2011.
Closer ties have already paid off for both countries. “Relations between South Africa and Ghana have matured over the years, and the increase in bilateral trade from $32m in 2008 to $60.9m is indicative of this maturity,” said Thabethe.
Local businesses have shown that that they are not dependent on the NDP’s support to invest across the border.
Keteku says that in large part, its investment decisions depend on the transparency, rule of law and business culture of the countries in which they look to invest. Vantage Capital has so far invested in three cross-border ventures.
Picture: THINKSTOCK
AFRICAN countries do not trade with each other very much. Even decades after becoming independent states, African countries tend to trade more with their former colonial masters than with their neighbours. The NDP is looking to change this by providing an array of incentives to get South African businesses to do more cross-border transactions.
Though offering incentives like paying for exhibition space has some part to play in getting local firms to set up shop abroad, Yaw Keteku, associate partner at Vantage Capital, points out that the biggest difference government has made was in prodding state-aligned institutions such as the Development Bank of SA and the pension funds of parastatals to invest. Without the backing of these state-aligned institutions, Keteku says it would have been difficult for Vantage Capital to raise R330m in funding for the expansion of Surfline’s 4G LTE network in Ghana.
Surfline was the 11th mezzanine transaction in Vantage Capital’s second fund, of which more than 80% of available funds have been invested. Vantage has commenced the raising of its third mezzanine fund, which is targeted to close by the first quarter of 2015, at $250m — R2,75bn.
The South African government has made growing stronger relations with Ghana a priority. Elizabeth Thabethe, while then still trade and industry deputy minister, said last year that both parties were looking to fast-track an economic and technical co-operation agreement signed in 2011.
Closer ties have already paid off for both countries. “Relations between South Africa and Ghana have matured over the years, and the increase in bilateral trade from $32m in 2008 to $60.9m is indicative of this maturity,” said Thabethe.
Local businesses have shown that that they are not dependent on the NDP’s support to invest across the border.
Keteku says that in large part, its investment decisions depend on the transparency, rule of law and business culture of the countries in which they look to invest. Vantage Capital has so far invested in three cross-border ventures.
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