The rapid pace at which South Africa is building renewable energy projects, driven by private sector investment, is viewed as positive in the global context, including at the recently held World Economic Forum's (WEF's) yearly Davos meeting, said business organisation Business Leadership South Africa CEO Busi Mavuso.

While there is an opportunity for South Africa amid a global context beset by risks, the momentum must continue, particularly the next steps to reform the electricity sector, including the establishment of an independent grid operator, she emphasised in her latest weekly newsletter, published on January 22.

"We have a unique role in the climate change debate. We are a carbon-intensive economy, but we have limited resilience to the extreme weather events that we can now expect. In line with the global experience, we have had significant floods, droughts and fires, but we have limited infrastructure to withstand their effects," she said.

South Africa must also demonstrate that electricity reform is not a one-off, with the logistics sector the next front for reforms to turn around the dismal performance of its ports and rail infrastructure, which are directly constraining economic output.

"We must also show that we are serious about reforms to other constraints on business, such as access to visas. It is no good going to a global forum telling investors they can come and invest their billions, but then expect them to wait six months for their visas to be processed. They look at the country holistically, namely that the opportunities are there, but they may not be enough if we do not resolve the frictions they face," she added.

Further, climate change also highlights that bulk water infrastructure needs urgent investment. Cape Town was the first major city in the world to nearly run out of water in 2018, thereby becoming a global example of the risks of climate change, Mavuso noted.

Good progress is being made to establish a National Water Resources Infrastructure Agency that will drive the massive investment needed to ensure national water supply is resilient, but the country must maintain momentum with key enabling legislation still progressing through Parliament, she said.

"We need significant flows of global investment to deliver the infrastructure we must build. However, we cannot expect our investment case to rise above the clamour over global risks. Instead, we must show that we are a part of the solution and that investment here is a good way of confronting those risks.

"Our infrastructure needs, including electricity, water and logistics, are clear opportunities for global investors to back the fight against climate change. We do not have to perform miracles, but rather show that we are making steady and stable progress," she emphasised.

Further, extreme weather events, driven by climate change, and risks related to artificial intelligence (AI) featured strongly at the Davos meeting. With a wave of elections this year, as more than half the world’s population go to the polls, and continuing wars in Europe and the Middle East, the global lodestar is a lack of certainty, she noted.

"We are also a part of the African story, which is a continent whose development needs are obvious. One topic that received attention in Davos is the African Continental Free Trade Agreement, which is gradually becoming a reality as countries ratify the required treaties and begin trading on the new terms."

The potential benefits for the continent are enormous and the agreement is an opportunity South African business must be alive to, Mavuso said.

Meanwhile, with so many elections taking place, the risks that AI will unsettle information flows and manipulate democratic processes are significant, from the US to India.

"We should remember that South Africa has been subjected to social media disinformation campaigns, most obviously during the State capture years. We must be ready for those tactics, now supercharged with AI, to be used in our own elections process this year," Mavuso said.

"The WEF meeting was a reality check on how the issues that preoccupy us South Africans are overshadowed on a global stage. It has provided an opportunity for reflection on the global context.

"We need to stay committed to reforms, and show we are serious about making steady progress. That is how we can rise above the extreme risks that the world is grappling with and show we are a part of the solution," she said.