For a foreign multinational to engage and enter the South African economy can be a daunting task, yet there are many opportunities and some great benefits if this is done correctly.
As the “business gateway to Africa”, what makes South Africa unique and attractive compared to the rest of Africa is its well-developed economy and a globally well-regarded financial and banking sector.
What can make South Africa challenging is that the government has adopted extensive and unique legislation and policies to facilitate changes in the racial construct of our economy. Government is determined to change the way money flows in the economy and has set on an aggressive path to do an extreme makeover of its fundamental drivers.
The Codes of Good Practice for Broad-Based Black Economic Empowerment were more than a decade in the making, and were extensively revised in 2013. It is not a new idea and it most certainly is not going to disappear in the foreseeable future – at least not before core objectives have been achieved.
There are many dimensions that may influence the business feasibility of setting up operations in South Africa and it is important to be familiar with the challenges and opportunities so that companies interested in entering the local economy can understand and manage the risks more effectively.
If the best option is to acquire a local company that already has an established client base, management team and organisational structure, Gestalt can assist its multinational clients to find the right local business to acquire; and the strategically-correct black-owned partner or business partner to facilitate the process of BEE compliance in the new local business.