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Despite facing fierce competition and slowing revenues in 2015, South Africa’s telecoms operators are well placed to see growth in the near to medium term. The mobile market is approaching saturation and a shift from traditional voice and SMS to data is expected to drive future growth, particularly in 4G long-term evolution (LTE) services, which are slated to expand significantly in the next several years. Although market competition remains a significant challenge, recent moves to buy out illiquid companies with sizeable infrastructure networks could indicate the beginning of a period of consolidation in the industry. This could benefit long-term profitability and boost operators’ ability to improve service offerings and capture greater market share, lending an optimistic outlook to the country’s telecoms sector. South Africa’s ICT sector has shown rapid expansion over the past two decades. The government has increasingly sought to provide support for nationwide development of internet connectivity through the National Broadband Plan, while rising data demand and the burgeoning e-commerce and mobile payment segments will further underpin sector development. At the same time, a shift away from traditional voice and SMS services into the realm of data services is prompting telecoms operators to invest heavily in new fibre-optic and next-generation infrastructure. However, the country’s delayed digital TV migration and lack of available frequency spectrum, which is critical for the rollout of 4G LTE mobile broadband services, has slowed progress. Even as the country faces near-term obstacles and delays, rising recognition of ICT’s importance to inclusive economic growth should allow the sector to remain at the forefront of digital innovation on the continent. This chapter contains interviews with Sifiso Dabengwa, Former Group CEO, MTN; and Asher Bohbot, CEO, EOH Holdings.

Although South Africa’s construction industry remains a major economic engine, the industry has struggled to maintain pre-2010 highs, when work related to the 2010 FIFA World Cup propelled sector growth into the double digits. The interim has been marked by project delays, labour unrest and a subdued macroeconomic environment, which saw employment figures, profits and new projects decline in 2014 and 2015. Despite these challenges, the industry’s long-term forecast remains positive, with major new investment expected in the coming years under the government’s National Infrastructure Plan and contractors benefitting from steady expansion in the residential real estate sector. Although far from the conditions of the early 2000s, South Africa’s property market has remained resilient in spite of challenging macroeconomic conditions. Rising demand for affordable housing and a host of “new city” projects have kept the residential market steady, while A-grade commercial space – albeit on the verge of oversupply in some areas – is poised for strong growth. Although rising electricity prices are having an impact on the real estate market, the country’s burgeoning e-commerce, transport and logistics segments are expected to improve vacancy and rental rates across all property segments. This chapter contains an interview with Eric Vemer, CEO, Group Five.

With the most energy-intensive economy on the continent, South Africa has undergone a spate of load shedding in recent years as demand for electricity continues to outstrip supply. While faltering output and poorly maintained infrastructure have had an adverse effect on the country’s economic performance, a range of government initiatives – notably the country’s independent power producer (IPP) bidding programme – should help strengthen long-term output and reduce the risk of volatility. As the country searches to find short-term solutions to plug power gaps in the national grid, policy implementation and a renewed focus on bringing the Medupi, Kusile and Ingula plants on-line will help to accelerate IPP programmes, curb load shedding and stabilise the broader power sector. This chapter contains an interview with Brian Molefe, Group CEO, Eskom.

One of the world’s more open economies, South Africa’s commercial activity and economic performance are closely linked to its ability to transport goods both within and beyond its borders. Although South Africa’s transport infrastructure is among the best on the continent, lack of investment in recent years has led to high usage costs and bottlenecks. The government is seeking to address the situation through a series of projects that involve boosting capacity at the country’s ports and enacting key public transport improvements. This chapter contains an interview with Mark Lamberti, CEO, Imperial Holdings.

One of the top manufacturing powerhouses on the continent, South Africa has a strong industrial tradition dating back 150 years. The past few decades, however, have posed challenges to the industry, with external and domestic factors weighing on sector growth. To help revitalise the industry, the government and industry leaders have been working to stoke growth and develop value-added industries. By autumn of 2015, some industry pressures were showing signs of easing, with industrial action coming to an end, and new power and water infrastructure coming on-stream. While some structural issues remain, particularly in the realm of labour legislation and education, the government’s industrial strategy has allowed the sector to maintain momentum, with investment incentives and close cooperation with investors helping to offset downside risks to a degree. Over the longer term, manufacturing will be buoyed by growth across Africa, which should support higher sales. South Africa also has a well-developed retail sector ¬– one of Africa’s largest and most affluent markets – with a sizeable portfolio of major domestic players. While recent macroeconomic difficulties have affected certain segments of the market, the retail sector has continued to grow, drawing in a number of new international brands looking for an entry point to the rest of the continent. Their arrival underscores the sector’s sound fundamentals, and the market looks set to remain highly competitive and active in the coming years. This chapter contains an interview with Andre de Ruyter, CEO, Nampak.

With an estimated $2.5trn worth of proven mineral reserves, the mining sector accounts for around 8% of South Africa’s GDP and 14% of total employment, making it the second-largest employer in the country. However, the industry’s output and performance have been under pressure in recent years, as bottlenecks in labour relations, uncertainty in policy direction and power shortages have weighed on sector growth. Mining is also subject to global headwinds, as slower economic growth in commodity-consuming nations has driven down commodity prices and weakened export revenue. Financial turbulence and volatility will likely see continued fluctuations in sector share prices and could limit capital investment in the near to medium term. However, as South Africa continues to offer some the best mineral reserves in the world, the efficiencies gained now are expected to translate into greater profitability as global commodity prices recover. This chapter contains an interview with Norman Mbazima, CEO, Kumba Iron Ore.