Major importers of diverse products

While South Africa produces many products of world-class quality for export, it is also a major importer of diverse products from most countries. From pharmaceuticals to telecommunications, SA is an advanced consumer of the latest on offer from international sources.

THE GOVERNMENT

The South African government is a major buyer. The government puts out an invitation to tender an official state publication, the State Tender Bulletin. Although the purchasing procedures of the central government and parastatal institutions favor products of local manufacturers, an overseas firm is not precluded from bidding if the firm has an agent in South Africa to act on its behalf. As a general practice, payment is made to the local agent.

Although there are currently no legislated minimums for majority-owned (non-white) businesses, pressure is growing to include "set-asides" and other preferences for black businesses in national government procurement policy. When selling to the government, consideration should be given to the government's priority on accelerating black participation in the economy.

The South African Government is attempting to centralise the buying procedures of national, provincial, local, and state-owned corporate entities. Currently, the Chief Directorate of the Office of the State Tender Board in Pretoria and nine provincial offices perform the administrative work of the State Tender Board and provincial tender boards, which has responsibility for buying for over forty government departments. However, as part of the Public Finance Management Act Regulations the tender boards will cease to exist on March 31, 2002.

Purchases are by competitive tender for project, supply and other contracts. Bidders generally need not pre-qualify, but the ability of bidders to supply goods or render a service generally is examined. Foreign firms can bid through a local agent, who will then be so examined. Bids for government tenders must be on a basis of all costs included to the point where the goods are required.

Additional information on tender requirements can be obtained by contacting:

Department of State Expenditure
Office of the State Tender Board
Private Bag X845, Pretoria 0001
Tel: (27 12) 315-5111; Fax: (27 12) 325-4533
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Click here for the National State Tender Board.

Click here for the SA Government Tender Bulletin.

AGRICULTURAL PRODUCTS

South Africa supplements local agricultural production with imports. Key products are consumer-oriented products, forestry products and intermediate products. One of the mainstays of the South African economy, the agricultural sector holds many opportunities with both the large commercial and the emerging farmer in areas such as capital investment, training, equipment and services supply.

Click here for the Agricultural Research Council site.

AIRPORT RETAILING

The Airports Company of South Africa (ACSA) currently handles approximately 90 percent of the country's aviation requirements, operating 3 international airports (Johannesburg International, Cape Town International, and Durban International), 7 national airports (Port Elizabeth, East London, George, Kimberly, Upington and Bloemfontein as well as Pilanesberg Airport near Sun City).

Encouraged by the potentially lucrative retail and property sectors, ACSA has identified the opportunities existing in airport retailing and continues to make progress in developing both airport infrastructure and peripheral property

Click here for the ACSA site.

COMPUTER SOFTWARE AND SERVICES

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One of the main areas of growth is the demand from the small - to - medium sized companies for high-end computer systems. This is set to become a major target for IT companies in the near future. The South African government is also expected to be a major purchaser of software. South Africa imports some 80% of its software from the United States with the balance Israel, Germany, the United Kingdom and France.

DRUGS & PHARMACEUTICALS

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More than a $1 billion worth of pharmaceuticals is sold in South Africa annually and the market is expected to grow substantially. The major pharmaceuticals distributors are the buying groups, dispensing doctors, pharmacists with wholesale licenses and wholesalers. As a result of this, a number of companies or associations of companies, have their own distribution divisions that are affiliated to these associations.

Dispensing occurs via private channels, dispensing doctors, retail pharmacies, retail chains, private and public institutions, industrial clinics, and private and government hospitals. Click here for the Department of Health site.

Click here for the Medical Research Council (MRC) site.

Click here for Health Systems Trust site.

Click here for the Pharmaceutical Management Information System (PharMIS) site.

FOOD & DRINK

South Africa has always had a well-developed food and beverage industry partly because of the country's major agricultural activity and partly because of its relatively sophisticated food requirements. During the apartheid years the food industry developed mainly to satisfy the domestic market and, as growth was limited by local requirements, a consolidation of the major companies took place. Since South Africa has become a member of the global market a number of multinational companies have formed partnerships with local food companies and new opportunities have opened up.

FRANCHICES

Key sectors for development are:

Click here for the Franchise Association of South Africa site.

GIFTWARE

South Africa has an expanding consumer base and a growing disposable income. South African consumers are prepared to pay a higher premium for international brand products.

RAILWAYS

Over the last 20 years, thousands of kilometres of South African railways have suffered losses of traffic and now need upgrading or are out of service due to the lack of capital investment and maintenance of the existing infrastructure.

The South African government is aware that the railways are critical to the integration of economic and social development of the country and are committed to addressing the problems. Opportunities lie in state-of-the-art equipment, operations, services and investment.

Click here for the Metrorail site.

SECURITY AND SAFETY EQUIPMENT

There is strong growth in private security industry technology such as CCTV and digital surveillance equipment, sophisticated access control systems (smart card technology), IT systems. Many cities have introduced surveillance cameras and businesses are increasingly updating systems with the latest technology. Home security is another key area.

Contact:

Security Association of South Africa
P O Box 2212, Primrose, 1416 Johannesburg
Tel: +27 11 828-5314/Fax: +27 11 828 5495
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TELECOMMUNICATIONS SERVICES

The South African Telecoms market is expect to grow by 14% by 2004 as the sector’s liberalization continues. The South African telecommunications market will see a second fixed line national operator compete with incumbent Telkom. There is also the licensing of State-owned signal satellite distributor Sentech with an international license, the possible licensing of a third network operator in 2005 in the pipelines.

Click here for the Independent Communications Authority of South Africa site.

Click here for the Telkom site.

TOURISM

Given its significant contribution to the economy, the development of a strong tourism industry is a high priority for the South African government. Opportunities exist for companies in hotel furnishing and equipping but a much broader range of opportunities exist in this thriving sector. The government has earmarked this sector as crucial to the economy and many incentives and development schemes are underway.

WATER & WASTEWATER

The South African government is committed to ensuring all its citizens have access to a minimum standard of potable water and sanitation. Many South African municipalities are looking to overseas companies to help them address these problems through concessions or management contracts. There have been early successes and it is expected that there are many more opportunities for water utilities and contractors to win future business.
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