Business in South Africa
Economically speaking, South Africa ranks among countries such as India and Brazil. The country is known as a “developing economy” and has both first-world developed nation attributes and third-world underdeveloped poverty. It is this dichotomy that is perhaps the most striking aspect of South Africa’s economic landscape, with the economy running along parallel lines, having both a formal, developed section and an informal, largely untaxed section.
South Africa’s GDP measures about USD3500 per capita per annum. This is certainly not one of the highest in the world, but it is far and away the highest in Africa. South Africa accounts for approximately one quarter of Africa’s GDP and more than 40% of the continent’s manufactured product. Having the largest economy in Africa, it is no surprise that South Africa is a target destination for immigrants from all over the continent.
The most important economic event was the change of government in the mid-1990s. This resulted in a new fiscal policy which has seen the economy show steady growth, although the recent global recession did have an impact on South Africa too. Exchange control regulations were also slowly relaxed after a brief tightening between 1990 and 1995.
South Africa’s stock exchange is based in Johannesburg and is called the “Johannesburg Stock Exchange” or “JSE”. The JSE has various indices, which reflect the nature of the country’s economy. Because the economy is so heavily based on mining and mineral commodities, there are separate indices for gold, platinum, and resources.
The language of business in South Africa is English, although it may be to your advantage to ensure that any documentation you issue is also translated into the applicable indigenous language. Because both local and multinational companies operate in South Africa, it isn’t always easy to anticipate what kind of organisational culture you will be dealing with, so prior research is important.
Generally speaking, you shouldn’t try to arrange business meetings over Christmas or Easter, as these are prime holiday periods for senior staff. You should arrange meetings in the usual fashion, but send your proposed agenda ahead of you before the time, so that everyone knows what you want to discuss. During the meeting, do not be surprised by off-hand banter and small talk; it is customary, and helps to defuse tension.
You should also be aware of the influence of trade unions. If you are planning on employing a number of people, you may well come into contact with trade unions. The unions are seen as important politically, and they have a vast membership.
Money Transfers to and from South Africa - here's how:
- Foreign exchange regulations in South Africa 03-01-2011
- Essential money transfer advice for all transactions 02-01-2011
- Exchange control relaxed in South Africa 28-10-2010