South Africa targets more investment

Government policies on Aids are a source of concern

President Thabo Mbeki has launched a campaign to tackle what he calls "negative perceptions" about South Africa amongst the foreign investors.

The programme is the result of a two-day meeting with international business leaders including the chief executives Jurgen Schrempp of DaimlerChrysler and Niall Fitzgerald of Unilever.

Those of us who know South Africa know what has been done and know what the potential of South Africa is

Niall Fitzgerald
Unilever

"There is a (negative) perception and that perception really needs to be dealt with in a very concerted way," said Mr Fitzgerald.

"Once that perception is tackled full frontal ... I think you will have a huge change of view," he added.

South Africa desperately needs increased foreign investment to support growth and job creation, but a combination of local conditions and anxiety over Zimbabwe, has scared off foreign capital.

"Let's go down the list. There's reporting about a very high crime and there is a very high violent crime rate, the government has been tardy about its economic reforms, and we live in a bad neighbourhood, just look at Zimbabwe," Jonathan Katzenellenbogen, International Affairs editor of South Africa's Business Day newspaper told the BBC's World Business Report.

"It's likely to involve an advertising campaign and target key editors abroad," said Mr Katzenellenbogen, adding that previous campaigns had failed.

Good progress

South Africa has been trying since the end of apartheid rule to attract significant investment to stimulate economic growth and create jobs.

Mr Mbeki is trying to stimulate foreign investment

After the meeting with his International Investment Council, Mr Mbeki said economic fundamentals and the quality of political and corporate governance should attract investment.

"Those of us who know South Africa know what has been done and know what the potential of South Africa is," said Mr Fitzgerald.

He added that he was impressed by the economic measures taken to bolster the economy since the panel met last year.

"What I heard is rather reassuring," said Mr Schrempp but raised concerns about the handling of AIDS and Zimbabwe.

Mr Mbeki has been criticised for denying universal access to anti-AIDS drugs to prevent mother-to-child transmission of the HIV virus and for rape victims, citing cost and safety concerns.

His stance on Zimbabwe and opposition to European and US sanctions against President Robert Mugabe has been blamed for lack of investor confidence.

The investment panel, which meets twice a year, was set up by Mr Mbeki after he succeeded Nelson Mandela as president in 1999.