South Africa

Unlike spending on toll roads, new ports, and industrial zones, where the immediate economic needs are easily identified and the longer-term benefits can be reasonably anticipated, gains from investments in sports tourism and related infrastructure tend to be less tangible.

A much-needed, multi-billion rand investment programme – spearheaded by Transnet’s capital upgrades and targeting South Africa’s transport bottlenecks – looks set to transform the country’s rail and port services, although historical issues over project delivery and pressure on the government fiscus have made its implementation a more complicated prospect.

The real estate sector in South Africa is showing early signs of upward movement after more than three years of underperforming, though any improvement in sales and buyer interest is still thin and analysts are wary of predicting an end to the slump amidst uncertainty over the local and global economies.

The economy is expected to post modest but steady growth in 2012, though to what degree GDP will expand is partly dependent on three key issues: the country’s credit rating, how quickly the government can begin rolling out its high-profile infrastructure programme and how South Africa’s major export markets fare over the next 12 months.

The recent credit downgrade of five of South Africa’s largest domestic banks by one notch has prompted quizzical reactions from the government and local financial community, coming just as four of the banks announced improving earnings growth and a decline in bad debt.

South Africa’s government is stepping up efforts to revitalise the country’s manufacturing sector and create job opportunities deeper within the country’s interior, seeking to reverse a long-term decline in the sector and address regional disparities in employment and production.