VZCZCXRO6311
RR RUEHDU RUEHJO RUEHMR
DE RUEHSA #4895 3491056
ZNR UUUUU ZZH
R 151056Z DEC 05
FM AMEMBASSY PRETORIA
TO RUEHC/SECSTATE WASHDC 0505
INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY
RUCPDC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS PRETORIA 004895 
 
SIPDIS 
 
USDOC FOR 4510/ITA/MAC/AME/OA/DIEMOND 
TREASURY FOR OAISA/BCUSHMAN 
USTR FOR PCOLEMAN 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: BEXP ECON EINV SF
SUBJECT: Amcham Business Climate Survey - 2005 
 
REF:  04 Pretoria 5303 
 
Sensitive but Unclassified; Protect Accordingly.  Not 
For Internet Distribution. 
 
¶1.  (SBU)  In the American Chamber of Commerce's 
(Amcham) 2005 Business Climate Survey, 75 percent of 
companies viewed the business climate as "excellent" 
or "good," up from 62 percent last year.  Ninety-two 
percent of companies plan to invest more or the same 
and either to maintain or hire more staff.  Fifty- 
three percent of respondents plan to invest more in 
the coming year, up slightly from last year. 
 
¶2.  (SBU)  As last year, respondents most frequently 
cited political stability, sound macroeconomics and 
economic growth as favorable factors influencing 
business and investment.  According to the survey, 
the biggest challenges are Black Economic Empowerment 
(BEE) policies, finding and retaining skilled staff, 
and crime (more than half had been adversely 
affected). 
 
¶3.  (SBU)  The majority of companies (80 percent) see 
BEE as important and essential for economic growth; 
however, 66 percent see it as a hindrance to further 
investment.  The vast majority of companies have in 
place BEE polices, including employment equity and 
BEE enterprise development and procurement programs. 
U.S. companies have invested heavily in skills 
development.  Sixty-nine percent of companies spend 
between 3-12 percent over and above the 2 percent 
skills development levy on in-house training as a 
percentage of payrolls.  Fifteen percent have sold 
equity. 
 
¶4.  (SBU)  The most highly regarded government 
organization is National Treasury, followed by the 
Department of Labor, Department of Trade and 
Industry, and the SA Revenue Service.  The weakest 
government organizations are the SA Police Service 
and Departments of Health and Communications. 
 
¶5.  (SBU)  Telkom, the parastatal telecommunications 
company, was seen as expensive and inefficient with 
poorly trained technical staff, poor response times, 
and long waits for installation and upgrading.  On 
the other hand, Eskom, the parastatal electric 
utility, was described as efficient and professional. 
Power failures, however, are becoming a financial 
drain and shutting down business communications 
systems. 
 
¶6.  (SBU)  Amcham plans to send the survey to the 
South African government and issue a press release. 
The survey results will be sent by e-mail to AF/S, 
Commerce and USTR.  Survey results are not fully 
comparable with last year due to changed questions 
and limited sample size.  Fifty-nine companies 
participated in the November survey. 
TEITELBAUM