Budget Hearings: Organised Business & IDASA

Meeting report

FINANCE PORTFOLIO COMMITTEE
28 February 2002
BUDGET HEARINGS: ORGANISED BUSINESS & IDASA

Chairperson: Ms Hogan (ANC)

Relevant Documents
SACOB input on the 2002 / 2003 Budget (Appendix 1)
Afrikaanse Handels Instituut Address (Appendix 2)
IDASA - Response to Budget 2002

SUMMARY
SACOB thinks it is good budget but submits that this does not mean that delivery will take place and asks government to ensure that the budget delivers. Areas that need attention are:
- the simplification of the compliance procedures
- corporate relief in the form of a reduction in Secondary Tax on Companies. Business was disappointed that this is unchanged.
- small business. The raising of the threshold is welcomed but more needs to be done.

The Afrikaanse Handels Instituut (AHI) also wants more relief for small business and is of the view that the current relief in the Capital Gains Tax regime is inadequate.

IDASA also thinks it is a good budget but submits that in the light of there being money available, more could have been done to target poor households. An extension of the Child Support Grant was suggested. The extension could have been financed by lower tax cuts or by maintaining the deficit at 2.6%. Both options can make enough money available and it is not a departure from fiscal policy.

MINUTES
South African Chamber of Business (SACOB)
The SACOB delegation included Adv Abri Meiring, Mr R Wood and Mr Ken Warren.

Mr Wood in his introduction, identified positive aspects of the budget as being the controlled expenditure, the decline of the deficit, the decrease of the debt service burden and the tax reductions.

The one negative aspect for business is that they had hoped for a reduction in Secondary Tax on Companies (STC) but this was not forthcoming.

Further business welcomes the increase in transfers to local government but is concerned about the readiness of local government and the level of management. In this regard the Minicipal Finance Management Bill is welcomed and is a step in the right direction.

Business also welcomes the fact that privatisation is taken seriously in the budget.

Adv Meiring spoke on tax relief in the budget. He identified three macro issues in the tax field:
- government's overall commitment to keep tax under 25% of GDP
- the tax system cannot be developed in isolation of the global context. The global trend is a move towards indirect tax rather than direct tax. SA is the opposite.
- tax administration is the acid test of any tax system. SARS, without any doubt, is performing well. Adv Meiring pointed out that enforcement is not the only element of tax administration. Service is an important element. He added that SARS had promised that the wait for tax assessments would be improved by 400% and this has not been done. In 2000 SARS promised a taxpayer charter and this has not been forthcoming.

The major submissions made on tax were on Company Tax and the Retirement Fund Industry:
- In respect of STC he said that business expected corporate relief. Adv Meiring acknowledged past relief in that not too long ago Company Tax was at 40% now it is 30%. Similarly STC used to be 25% and now it is 12.5%. It was submitted that a new STC rate of 10% would have been appropriate. The average rate of company tax is at 37% and this is out of sync with global competitors. SADC is about 25% and most other competitors are at 30%.

- On retirement funds, Adv Meiring said that a former Minister of Finance, Mr Liebenberg, imposed a 17% tax on retirement funds as an interim measure. The final plan was to be put in place in the 1997 budget but never materialised. The current Minister raised the rate to 25%. It was submitted that this is a direct tax on the fund and not on the industry. The former finance committee chair and now Deputy Minister of Finance, Mr Mpahlwa, had acknowledged that people are worse off saving through a retirement fund than privately. An example was given where if a person is a member of a fund for 30 years only 1/3 of the capital will be available to the member on retirement.

SACOB suggested that as an interim measure the rate be reduced to 18%. The suggestion might be arbitrary but it was submitted that the 17% imposition and the subsequent increase was arbitrary as well.

The Katz Commission had called for the payment from pensions and annuities to be tax free. In SA the contribution is exempt but the income of the fund is taxed at 25% and then the payout is fully taxed. This does not happen anywhere else in the world.

Progress on this issue is less than ideal. Both the Committee and the National Assembly had said that the industry would be reviewed between 2001 - 2003 and this is being awaited. The Committee was asked if it was fair for people to live with the unfair position for two years while everything is being reviewed. Would it not be better to lower the rate to 18% in the meanwhile.

[The full submission is attached as Appendix 1]

Discussion
Mr Moloto (ANC) referred to the SACOB submission that the budget is tilted towards the demand side and asked what steps can government take to kick-start the economy on the supply side.

Mr Wood replied that SACOB was looking at the reduction of STC because then there would be greater incentive for creating employment and starting a business.

Mr Andrew (DP) commented that an individual has to earn R170 000 before the average rate of taxation is 25%. If the fund pays tax on earnings at a rate of 25% then the member is effectively paying more tax on his savings than he is on his salary. This will be especially true for low income earners who are members of funds. These people will therefore be increasingly dependent on state services in retirement. The member said that there was certainly a disjuncture.

Ms Hogan agreed. The review had been put on hold because of Capital Gains Tax (CGT). She said that the Committee must now hear from Treasury on what has to be done.

Ms Mahlangu (ANC) referred to the SACOB comment that the reduced top marginal rate will help keep skilled people in the country. She asked if the 42% rate caused people to leave. She also wanted SACOB's view on the economists submission that business confidence in SA is low.

Adv Meiring replied that the 42% top marginal rate is high compared to the services received. In other countries the services received are more extensive. For example, health care could be free.

Mr Wood added that confidence is a complex issue with no simple answer. SACOB does promote economic development and business. Many businesses have different perceptions but there is a need to boost confidence.

Mr Theron (DP) wanted clarity on the submission on local government.

Mr Wood replied that the rationalisation of local government has resulted in administrative difficulties. The skill levels of councillors are very important because if they do not know what is going on, then decisions are only being made by officials who are not elected representatives. The management of a city is complex and understanding the accounting is complex and it is difficult for councillors to get a grip on his. The concern of business is that they pay the taxes and this revenue gets allocated reasonably to a certain area but at the end of the day it is not spent.

Ms Maabe (ANC) thought that SACOB did not understand that CGT was intended to transform the tax system and was she was critical that SACOB criticises its complexity.

Adv Meiring replied that CGT is a complicated tax by nature because capital is mobile and takes on many different forms. He said that this does not mean that business will not comply. One of the problems with CGT is that SA does not have a group taxation system. Each member of the group is taxed separately and this creates a cascading effect.

Ms Joemat (ANC) asked how many of SACOB's 35 000 members are affected by the rise in the small business threshold to R3 million.

Adv Meiring replied that he did not have figures. Mr Wood noted that 80% of any chamber is made up of small business. SACOB is very conscious of small business. Adv Meiring added that small business relief only applies to the manufacturing sector and excludes service-providing companies which are growing worldwide. He submitted that the relief should be extended to this sector as well.

Dr Koornhof (UDM) noted the increase in capital spending on public infrastructure and asked what level of government does business see as the best spending platform. He also wanted to know what role do the larger SACOB members have in public infrastructure spending.

Mr Wood replied that the problem is spending the money that is available. The problems of local government have been highlighted but in theory local government should be the best platform because of its closeness to the people.

On the role of larger companies he said that structures have been set up to discuss with other tiers of governments how funds will be directed before the budgets are announced. At the same time business will indicate where it has problems with infrastructure.

Afrikaanse Handels Instituut (AHI)
Mr Boonzaier presented the submission. He made a call for all the positive aspects of South Africa to be communicated to everyone and in this regard attached an e-mail to his submission. The AHI submits that a great deal has been done to secure economic growth but it feels that much more needs to be done. In this regard issues around small business relief, CGT and the complicated tax system were raised. [The full submission and e-mail are attached as Appendix 2.]

Discussion
Dr Rabie (NNP) questioned why the AHI calls for the RSC levy to be abolished. He said that it is important for the subsistence of some municipalities and wanted to know how the void would be filled.

Mr Boonzaier replied that the comment must be seen against the background of tax simplification. He is not suggesting that the income should not be replaced. SARS effective collection could be used to fill the void.

Dr Rabie followed up by asking if the RSC levy has such a profound effect on business.

Mr Boonzaier replied that in isolation there is no effect but if one considers the whole tax liability and all the separate forms plus the payment procedures for the RSC levy then it is substantial. He stressed that the point was simplification of the compliance procedures.

Mr Kolweni (ANC) referred to the request that there should be more relief for small business and asked what specific measures the AHI had in mind.

Mr Boonzaier replied that a submission to DTI has been made in this regard but he does not have all the details. What is clear is that more needs to be done.

Ms Hogan requested clarity on what business would not operate through a company or cloase corporation. She asked if it would not be a problem if small business did not conduct business in those entities.

Mr Boonzaier replied that there are many small businesses operating through trusts and partnerships and the relief granted in the budget does not extend to them.

IDASA
The submission was presented by Mr Albert van Zyl. At the outset he said that it was a good budget and everything he said must be seen in that context. IDASA is merely pointing out how the budget can be adjusted to make it more balanced.

Two important features of the budget were the large tax cuts and the increase in expenditure. He said that this must be seen against the background of unemployment and rising food prices and was therefore good relief for the poor.

He submitted that poorer households were under great pressure because job shedding continued and the economy was growing more slowly. Business Day had reported that agricultural food prices had risen 26% over the past year. It can therefore be argued that in the past six months since November the plight of the poor has worsened. The budget does not have any short term relief. The point being made is that poorer households must be supported and while the Budget does address this it does not go far enough.

Mr Van Zyl identified R40 billion in extra revenue mainly made up from R15 billion tax relief and R16,7 billion additional revenue. Of this additional revenue available to the state, R15 billion was given back to taxpayers and R25.3 billion to expenditure. It was submitted that the tax relief is no support for the poor. Of the 18 million South Africans working, only 3 million are in the tax net.

In addition cuts can be offset by high inflation rates. It also is not known how the money is going to be spent and we do not know that any kind of economic growth will create jobs. What IDASA is saying is that they do not have a blue print of what should be done, just that it is risky.

Mr van Zyl said that the challenge that faces government is the extension of grants - not just an increase or the current rollout thereof. The people outside the current security net, the unemployed, must be targeted.

The 4.1% growth in expenditure is welcomed but it is submitted that there is money available for income support. Income support could have been funded by lower tax cuts or an increase in the deficit. In November the Minister predicted a 2.65 of GDP deficit. The deficit announced in February is 2.1%. Treasury was prepared for a 2.6% and they could have used this without any change in policy.

Two kinds of income support grants were identified:
- The first is the basic income grant (BIG) and this would increase the number of people receiving income support. The problem is that it takes time and money to sort out how it will work. There are also political decisions to be made. For this reason a second option is presented.
- As a second option the existing grants could be extended. IDASA submitted that the Child Support Grant can be extended. Currently only children to the age of 6 qualify. IDASA suggests that the grant be extended to children between 7 - 12. The cost would be as little as R2.9 billion. The 0.5% that can be used of the deficit amounts to R4.5 billion so even if the admin costs of the extension is added, the cost is covered.

If the extension is funded by a lower tax cut then the tax relief will still be R4 billion more than last year if R4 billion is used to fund the extension of the grant.

It could be argued that even the extension could take long to implement. To counter this argument, Mr van Zyl says that if a child turns seven he must not be taken off the grant. In this way there will be no new registrations.

In conclusion, he said that the Budget can do more with very little change.

Discussion
Mr Nene (ANC) asked if IDASA has taken into account that all those eligible for CSG have not taken up the grant. He also wanted to clarify that there would be enough money available even after the tax cuts.

Mr van Zyl replied that the Budget speaks of extensive progress in the roll-out of the CSG. The full programme has been budgeted for.

Responding to the second question he said that if 60% of children from 7 - 12 are eligible and 50% of them take up the grant then both financing proposals comfortably pay for it.

Ms Mahlangu asked for IDASA's view on the increase in the old age pension and the increase in social spending in general.

Mr van Zyl replied that SA, Namibia and Mauritius are the only countries in the region with income support. He said that it was a good budget with significant income support for the poor but it could have been better. He added that nothing said should detract from government achievement but because of the flood of money, it is submitted that more could have been done.

Mr Andrew asked if IDASA had any idea what was the cost of administering the means test.

Mr van Zyl said no. Treasury provided them with information.

Mr Andrew added that there was so much paper work to fill out and a lot had to do with he means test to see if the person owns a home or is getting an annuity etc. All this is difficult to police. The member said that he would not be surprised if the cost of the means test accounted for a significant proportion of the administrative expenditure.

Ms Hogan commented on the choice between tax relief and further social spending. She said that the employed support the unemployed and that tax relief was not just for the individual but part of the system of reliance. Ms Hogan made it clear that she was in no way saying that grants are not important but that she was worried about saying that tax relief is just for the employed. This obscures the dependency ratios. She recognised the complexity of the issues and used the example of a person not eligible for a pension because the spouse is employed and might be earning a meager wage. In this case tax relief does help. Ms Hogan concluded by saying that she still however did not fully understand how tax cuts and poverty relief interact.

The meeting was closed.

Appendix 1
SACOB INPUT TO THE PARLIAMENTARY PORTFOLIO AND SELECT COMMITTEES ON FINANCE WITH REGARD TO THE 2002/03 BUDGET

1. Introduction
Through the affiliation of some seventy countrywide Chambers of commerce/industry/business to SACOB, it represents close to 35 000 businesses both large and small. SACOB welcomes the opportunity to participate in the public hearings on the Budget. This memorandum outlines certain issues relating to the Budget. For convenience they have been separated into the economic and the taxation components of the Budget.

2. Economic
SACOB believes that the Budget could have induced more risk taking to mobilise private fixed capital formation in South Africa. Capital expenditure accounted for only 5,3% of the consolidated expenditure of the national and provincial governments in 2000/01. The increase from 6,6% last year to 7,6% in the 2002 Budget is a step in the right direction. Indirectly this will promote economic growth on the margin but will still not encourage a paradigm shift in foreign direct investment that ultimately seeks high sustainable economic growth environments.

There is a need to focus South Africa's macro-economic policy framework by way of imaginative supply-side measures. The stimulus that will be forthcoming in the form of improved disposable income levels in the middle and lower income groups as well as the poor and socially deprived is welcomed. However, it is to be hoped that households will use some of this additional income to lessen their debt burden rather than indulging in excessive spending. Such a course would lead to the generation of inflationary pressures induced by domestic supply not being able to meet the challenge. SACOB submits that a smaller real annual increase in social spending and more supply side tax reforms would have been more appropriate at this stage. This would have encouraged greater risk taking by private sector capital and thereby fostered a greater level of growth. Such a measure would have given a fillip to employment creation and to some degree would have addressed the serious poverty problem.

Expenditure
With regard to the expenditure side of the Budget, SACOB would support the following principles:
- Performance criteria to feature more prominently in the appropriation of resources on an
annual basis.
- Increase capital expenditure on economic infrastructure to at least the extent that dissaving by
government is neutralised.
- The imperative of performance audits and accountability on institutional and functional level (i.e.
measurable delivery).
- Closer scrutiny of the application of Special Purpose Funds.

The Budget Deficit
SACOB endorses the following:
- Maintain the deficit before borrowing below 3% of GDP
- Securing agreement on a committed privatisation process on which deficit financing is based.
- The reduction of the State debt.

Local Government
The continued financial weakness1 vulnerability, management and fiscal sustainability of local governments need urgent attention. Local governments are the "real" site of service delivery and sound financial management and criteria on that tier of government should be sharpened now that national government has shown its commitment by appropriating more resources in that area. The increased transfers payments to local authorities should be met by the necessary prudence. Co-operation with the local business community is an uncompromising condition for the successful development and growth of those areas.

3. Taxation
Personal Income tax relief
The relief offered by the raising of the tax threshold and the lowering of the marginal rate to 40 per cent is welcome. It is a measure that could serve to retain skills in the country. To an extent, it serves to at least offset the effect of fiscal drag.

Corporate Taxation
Other than certain depreciation concessions, there is no tax relief for the corporate sector. This shortcoming can only be interpreted as a negative signal for it fails to bring South Africa's tax threshold levels to those pertaining in other emerging markets.

Increase of interest and dividend income exemption
This measure will hopefully bring specific relief to those taxpayers reliant on fixed interest incomes but is not enough to spark an enhanced savings culture.

Accelerated depreciation allowance
SACOB welcomes this measure and believes that it will provide a much-needed encouragement to the manufacturing sector.

Small Business relief measures
SACOB welcomes the proposed review of the administrative procedures pertaining to the tax compliance measures applicable to small business. it is to be hoped that this review will be undertaken expeditiously and in consultation with private sector input. More immediately, while certain of the measures outlined in the Budget are to be welcomed, they appear to be directed at the 'non-service' sector of the economy. It is submitted that service industries are becoming an increasingly important area for the small business sector and the economy. Last year, the service sector grew by about 4,5%. At present, serious impediments to the development of this sector exist. Nowhere is this more evident than in the harsh manner in which Personal Service companies are treated in the tax regime. SACOB has and will continue to engage the tax authorities on this issue. The objective is to reconcile tax compliance with measures that do not cripple the growth of the small business service sector. SACOB notes and welcomes the proposal to raise the small business benefits threshold from R1 m turnover to a more meaningful R3m.

CGT and its application
Efforts to persuade government to reconsider the desirability of CGT have come to naught. SACOB intends to monitor the effects of this tax and in particular its likely adverse affect on investment flows. It is, and will forever remain, a complicated tax device, the burden of which falls heavily on the taxpayer. Now that it is a fait accompli, SACOB will strive to see that its application is understood and its collection runs smoothly.

Tax Uncertainty
It is inevitable that uncertainty would arise from the abundant tax amendments passed in the Second Revenue Laws Amendment Act, 2001. A number of areas have still to be clarified by the tax administration, not the least of which being the handling of foreign exchange fluctuations. The recent publication of a proposed new 'designated country' list has caused significant uncertainty and SACOB urges that its proposals be seriously considered and radical changes to the list be avoided especially with countries that South Africa has historically enjoyed close trading links.

Learnership Incentive
SACOB welcomes the proposed learnership incentive scheme. The incentives appear meaningful. Concern, if any, relates to the fact that the scheme is linked to the Skills Development Act and the National Qualifications Framework, neither of which is functioning optimally.

Strategic Investment Incentive
The details of this scheme have just been made available a year after the scheme's announcement. South Africa's experience with investment incentives has shown up administrative weaknesses. The efficacy of this scheme has yet to be demonstrated.

Taxation of Retirement Funds
Although it is acknowledged that the taxation of retirement savings is to be the subject of a holistic review, SACOB must express its concern that measures designed to tax the income of such funds can only be met from one source - namely the people that invest such funds. It is a misconception that the ultimate bearer of such taxes is the insurance industry. At the current level of 25% the tax on retirement funds is a disincentive to saving and is particularly harsh to the majority of middle to lower income workers whose personal tax rate will be lower than 25%. Furthermore, it is the people who receive pensions from these funds that are penalised.

User Charges
SACOB supports the 'user charge' principle in circumstances where public sector goods and services are provided to individuals who can afford to pay. Where there is a departure from this principle, there must be a transparent measure of the extent and direction of any subsidy provided.

4. Conclusion
The balance in the Budget is tilted towards the demand-side of the economy rather than supply and investment enhancing measures. It attempts to address poverty alleviation imperatives as well as some of the impediments to economic growth. The Budget nevertheless offers some respite to business, and in some areas, small business in particular.

The problems generated by the compliance requirements of a sophisticated tax code have yet to be fully understood by both the tax administrators and taxpayers. In that respect, SACOB will engage constructively with the authorities in an endeavour to ensure that the system delivers.

Of course, good budgets don't necessarily guarantee delivery. To this end, SACOB urges the executive arm of government to hold their respective public managers accountable for measurable delivery.

Appendix 2
Afrikaanse Handels Instituut
Address on Budget Speech
1. We strongly endorse the Minister's sentiments of "taking charge of our destiny and of finding solutions that are appropriate for our needs and circumstances". We have pointed out before that, while it is informative and often instructive to consider the solutions that other countries have applied to address similar problems (especially first world countries), we need to ensure that those solutions are appropriately adapted for our own needs and circumstances in South Africa. Now is the time to do what is good and right for South Africa, taking into account our local conditions and circumstances and using our own expertise.

Both the State President and the Minister agree with the notion that we need to achieve higher rates of economic growth and development. The State President in his State of the Nation address recently announced the convening of a Growth Summit. This summit should make recommendations to government on ways to achieve the economic goals the President and the Minister have referred to, particularly what action needs to be taken to achieve our job creation and savings objectives.

2. The AHI has also previously pointed out that legislation often unintended consequences in certain circumstances. We urge Minister and SARS to be pragmatic in resolving some of unintended consequences of certain of the tax proposals in Minister's budget speech. The abolition of certain allowances and the limitation of employee deductions may create additional administration costs for employers and may cause hardship to certain employees.

3. The abolition of certain financial transaction taxes is to be welcomed. We would like to encourage government to also consider the abolition of RSC levies. As a starting point, we recommend that small businesses be exempted from these taxes.

4. It is our view that the impediments to corporate restructuring and the cascading effect of CGT have negative and detrimental economic consequences. We believe that these rules may be extremely negative to certain black empowerment groups in addition to other pyramid structures in our economy. The rigidity in the rules needs to be replaced with flexibility in order to release economic benefits tied up in certain pyramid structures. The relief provided for currently is in our view inadequate.

5. We commend the Minister for reducing the tax and compliance burden for small business. However, further ways to grant relief to small business need to be investigated and implemented without compromising the integrity of our tax system.

It is regrettable that certain allowances for small business are restricted to companies and close corporations when a large part of small businesses in SA are not conducted through corporate structures.

The improvement of the taxation and compliance burden of small business is an aspect that the AHI has pleaded for consistently over many years. We wish to repeat our offer to assist government in creating a tax environment that is conducive to a healthy and vibrant small business sector.

6. The administrative benefits of the Designated Country List are acknowledged. However, frequent changes to the list are clearly not in the interest of certainty, a key pillar of any good tax system. We propose that a set of objective criteria to be used by SARS in determining which countries should be on the list be published, and that SARS be required to give 12 months notice of any changes to the list.

7. The AHI has previously expressed its concern regarding the negative perceptions of residents and foreigners about South Africa. The Director-General: Finance, Ms Maria Ramos, is reported to have stated that, in her view, the main reason for the dramatic depreciation in the value of the Rand, was not so much events in Zimbabwe and Argentina, but rather the negative perceptions South Africans and foreigners have of this country. We previously urged the Minister to "include sincere statements ... that the government's intention is to make SA a better place for all our citizens". The message in the Minister's speech goes a long way to achieve this. We encourage the Minister to publicise positive achievements more frequently and more widely. In fact, all our citizens should be encouraged to do likewise.

8. It is critical to take the correct decisions to create the desired economic growth. Clearly the Minister agrees with this view, because he uses the word "grow" or "growth" no less than 30 times in his speech. It is important that all relevant role players take a pro-active approach to the Summit on Sustainable Development and the Growth Summit referred to above. What is required inter alia is a growth orientated tax system to propel our country's economy into an era of unprecedented growth to create a better life for all our citizens.

CONCLUSION
The AHI is encouraged by the extent to which certain of its recommendations with regard to taxation and economic growth in the recent past have been accepted and implemented by government. We reaffirm our commitment to make a constructive contribution to make this beautiful country a better place for all its citizens. We acknowledge that a great deal has been achieved to secure economic growth, but clearly much more is required. We wish to extend a helping hand to everyone who supports the ambitions of our State President. We need to look forward and move forward.

W A BOONZAIER
CHAIRMAN: AHI Tax Policy Committee
28 February 2002

E - Mail
For all South Africans

South Africa, almost alone amongst emerging market economies, is set 10 escape virtually unscathed from the latest bout of investor panic sweeping the developing world's fragile economies (The Times, London, August 2001)

The SA banking sector has been consistently ranked in the top 10 in terms of competitiveness (IMD, Switzerland)

When Nelson Mandela was inaugurated President in 1994, SA was insolvent (liabilities exceeded assets). Today the Government's deficit is negligible - one of only a handful of countries in this position.

We've had single digit inflation since 1993 - following 20 years of double-digit inflation. Mortgage rates are at their lowest level since
1988.

South Africa is one of only 12 countries, where we can drink water from a tap. Our tap water was found to be the 3rd best quality in the entire world.

Remember 15 years ago, in 1986 - A state of emergency was declared, white men did two years compulsory military service, 64 184 black people were removed from "white areas", 3989 people were detained without
trial, our economic growth rate was 0.7 percent. Today it is 3%. 64 countries
had sports boycotts against SA II!

South African wines win international awards every year and we have the longest wine route in the world.

Nelson Mandela, an international icon of forgiveness, tolerance, and humanity is our favourite son

The Kruger Park has the most innovative management of a national park anywhere in the world - and is the world's most profitable game park.

Eskom is the largest producer of coal-fired electricity in the world and South Africans pay the least for electricity in the world.

South African Breweries is the 4th largest brewer in the world and produces over 50% of China's beer!

Mercedes Benz C Class, BMW 3 Series and WV GoIf/Jetta vehicles for all right-hand drive markets throughout the world are produced in South Africa.

Didata grew from a local IT service provider into a huge, global networking company with branches in 30 countries.

The Cape Peninsula has more species of plants here per hectare than any other area of the world.

Magnificent highways

Warm, friendly, vibrant rainbow people.

The world's most progressive Constitution

Kreepy Kraulies - a South African invention

Mrs Ball's chutney and biltong

The world's best looking population

"Leader's deal in hope - I give many speeches nearly daily and I talk about positives. Many have forgotten the Kasspirs and guns - its paradise now in comparison."

"I've got four children and ten grandchildren and we are staying right here". Raymond Ackerman, CEO Pick 'n Pay.

"For every guy who holds up a gun, there are 99 who hold out a hand of friendship" - Dennis Beckett, journalist

After reading this, all I ask from you is to send this on, to your friends, family and others. Let us in
this way deal with our negatives and let us try to be positive. By being positive we can go far in life and we can all strive for a better and
more positive life and country.

Regards to you all, peace, and positive thinking - that's the way to go'.