Most of Discovery’s R13bn spending budget will be invested in SA
CEO Adrian Gore, who is convinced the local economy is poised for growth, says South Africans are all gloom even during a boom
Discovery has committed to spending the bulk of the R13bn it plans to invest in its operations over the next five years in SA, saying it believes the fundamentals are in place for the local economy to grow.
Speaking at the Discovery Leadership Summit on Thursday, Discovery CEO Adrian Gore said part of the investment will go towards capital expenditure on the company’s infrastructure and in getting the Discovery bank, which was supposed to be launched in the third quarter of 2018, off the ground. The company still expects to launch the bank this year.
New investments will also be made to prop up Discovery’s business insurance offering, the umbrella fund business, and other businesses the company is starting but would not elaborate on.
“The sum of those investments and our building as it goes through is a R13bn investment. That might change but it’s pretty set,” said Gore.
He said Discovery was convinced South Africa’s economy will grow because the country has made considerable progress despite the challenges it is facing.
“We need a positive narrative to appreciate that South Africa has made progress so that we invest in the future. If the GDP were to contract, and I will be very surprised if that happened, it will be because we haven’t taken the opportunity,” said Gore.
Gore said statistics showed South Africa’s GDP growth was less volatile than other Brics countries, apart from China, and the depth of its capital market was something to be celebrated. For instance, the value and volume of daily trades on JSE was 30 times bigger than the second-biggest market in Africa, Egypt; and 200 times bigger than Nigeria.
“You can’t argue we are in decline, it’s simply not true,” he said.
Gore said the problem was that South Africans were always seeking negative signals and thought the country’s problems were insolvable. Even in boom times, sentiment remained negative.