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Investment Guide

Inaction And Ineptitude



South Africa needs a solid plan to deal with the more than $245 billion of backlogged infrastructure that is curbing industrial growth and social development.

A toxic cocktail of events and cruel circumstances continues to damage a hitherto world class industry that is vital for any planned economic revival.

The construction industry is suffering like never before. It is still shrinking from its 2008/9 peak, shedding several hundred thousand jobs, margins plunging to around 2% and little sign of relief.

The reality is that, despite political hot air, very little of the backlog of crucial infrastructure, needed to attract foreign and domestic industrial development, is being dealt with. As inaction continues, the capacity to deliver this crucial infrastructure is being destroyed, potentially leaving South Africa at the mercy of foreign influence.

The political influence that black business has in demanding an end to perceived white dominance of the sector, as well as the ratcheting of transformation demands and targets for black empowerment and black industrialization, drives a relentless, but necessary, agenda at a difficult time of negative growth.

In addition, many of the local construction groups have suffered reputational damage and have been heavily financially penalized by government for reported competition infringements.

The industry has suffered massive losses on major projects in South Africa, Africa and Australia, many of which are public sector projects which were poorly engineered and badly managed by both government and contractor.

Share prices have plummeted in recent years and skilled people have been eagerly sucked up by banks, consulting firms, mining and industrial companies.

The public view is negative, and notwithstanding the understandable loss of trust, the government has paid little attention to the damage to the South African economic revival that we all hope for.

The localization of the nuclear program and the infrastructure embedded in the National Development Plan are wishful thinking.

There is a new group of transformational CEOs appointed into many of the large construction groups. We realized a massive wake-up was required. The old guard had gone and we had to deal with the fallout and culture change required to root out historic anti-competitive behaviors and racist tendencies. We found we were not close enough to government and black business and we were not listening to the messages nor understood the outrage directed at the industry.

A few of us traveled a lonely journey trying to facilitate a new beginning and open dialogue between a diverse and relatively untransformed industry peer group leadership and the fragmented approach from four ministries that purported to have control or influence over the industry.

It was not until the chasm between traditional business and government claimed its first victims, through the heavy fines imposed by the Competition Commission and the threat of further action, that the attitudes of some of the diehard leadership among the peer group changed.

They had finally realized it could not be business as usual. Their anger was misplaced. Government and black business action was not about a perceived vendetta, it was fueled by the perceived exclusion of black business and broken trust in the construction leadership’s apparent lack of commitment to transformation and clean business.

After five years, the unproven remnants of the competition matter remains disputed. The Construction Industry Development Board (CIDB), the industry’s regulatory body, continues to threaten to impose blacklisting sanctions and state-owned corporations charged with implementing the major infrastructure works remain short of capacity and technical skills to be able to manage the projected infrastructure projects worth R4 trillion ($245 billion).

Yet the economy is screaming for the infrastructure to be built to attract regional and international trade and investment.

Construction leaders have fast tracked the inclusion of black business interests, cleaned house and retained capacity at great cost to support the national infrastructure agenda. Yet government remains distant and unengaged, while some black business structures continue to bark demands with self interest in mind.

It is suspected that tenders for much needed infrastructure are being withheld pending a resolution of the trust and empowerment issues. It also appears that cabinet is unsure of which politically acceptable route to follow. This is very worrying and is preventing the country’s progress.


Cryptocurrency for Africans




George Gordon is on a quest to revolutionize the financial system. The director of Africa Master Blockchain Company talks digital currencies, blind risks and board games.

What is this new African cryptocurrency you are offering?

Where the majority of current digital currencies are based on speculative models, AfriUnion Coin (AUC) and the AfriNational Tokens (ANT)are designed for a transactional purpose allowing international payments, remittances, foreign direct investment as well as day-to-day transactions at local retail stores and other outlets. While the option for speculative trade is available with AUC, the focus is not around that.

Each African country will have a specially-designed ANT which will allow users to pay for goods and services and bills easily through completely digital means without requiring any bank account. AUC and ANT will be fully interchangeable to one another and there will be no fees for the user.

It’s the natural next step for digital finance from mobile banking which most Africans are accustomed to. The ability to freely have the power to send and receive money locally and internationally will allow the freedom of choice and spending power many Africans don’t have currently.

What is your own investment philosophy?

I am a gambler! I believe in taking risks and putting things on the line. That being said, blind risk or whimsical guesses don’t get you very far. Always acquire enough information to understand to a reasonable level what the thing you are planning on investing is or how it works and then trust your instinct and gut feel.

What advice would you give entrepreneurs wanting to invest in blockchain?

First, do some research in terms of what the blockchain technology is being applied for or created in terms of its application to an industry or project. Thereafter, check the white paper for the design of the platform as well as its functionality and applicability to what it is trying to achieve. If it aligns with your personal investment rules, then go for it,however, remember that blockchain is continuously evolving and thus you need to explore outside the usual and standard.

First cash-less, now card-less. What is the future of online banking?

If we are looking into what is currently science fiction, I would say the future is digital contact lenses that will be able to connect you to all your social media accounts, internet, news as well as make payments by just looking at QR codes or specialized barcodes to approve and accept payments.

Now, realistically we are not far off from such innovation and technology, but for the time being, I think the next step is scanning of QR codes at retailers and having the transaction automated from your wallet to the retailers digitally.

What is your most prized investment and why?

My mind. I believe that the work I have put into developing my mind, and continue to do so every day, is the number one investment that I have ever done. It allows me to look at things in a unique perspective as well as provides me with the tools to push boundaries and create new opportunities.

Money, success, fame? Which is most important to you?

I would have to say success… because it is most likely going to bring the other two as well, right? But success in the form of starting something and letting it grow and succeed and knowing that something new exists because of your efforts.

What do you spend your money on mostly?

Board games. I love board games and believe it’s a fantastic way to expand your mind as well as have fun with friends.

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Investment Guide

King Price CEO On Why He Invested On Insurance



King Price Insurance’s CEO Gideon Galloway, who built an insurance company in South Africa worth over $226 million in six years, talks investments, industry trends and how self-driving cars will change the entire car insurance landscape.


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Offering The American Dream



Gar Lippincott and Daniel Ryan of Atlantic American Partners were in South Africa recently looking for high-net-worth individuals wanting to invest in the US.

It’s a warm spring day in September, and Gar Lippincott and Daniel Ryan have just arrived in South Africa. It is Lippincott’s first time in the country, and he is jet-lagged.

A little over two months ago, he was booked to fly here from the United States (US) but was turned back at immigration.

“At Atlanta airport, the lady looked at Daniel’s visa and let him through and she looked at my visa and she said ‘I am afraid you can’t get on the plane because you have to have a blank page on your passport’. I said ‘I have three blank pages’ and she said ‘no, it’s supposed to be the one that says visa on it’. She said it’s the rules in South Africa so I had to sadly go back home… now when I was coming, I was told that’s not an issue anymore so I am happy they have made traveling into the country easier,” says Lippincott.

With a brand-new passport, he’s here with Ryan looking for people who want to invest in the US in exchange for a green card.

Lippincott, the Managing Partner of Atlantic American Partners, says he has always been keen on South Africa for its growth opportunities and prospects.

“From what I understand, the things that are causing short-term decline in the economy in South Africa are set up to provide long-term growth and hopefully people will understand this,” he says. Ryan, the company’s Managing Director of Emerging Markets – Africa, agrees: “I lived in Malawi for 12 years and South Africa is still considered the shining one throughout the continent. Even with all the problems, everyone still wants to come here because of the opportunities.”

According to an AfrAsia Bank report, South Africa comes second to Mauritius in boasting the highest number of high-net-worth individuals.

These are the kind of people Ryan and Lippincott target through their work at Atlantic American Partners. The company has real estate investors and professional private equity fund managers that manage money for banks, insurance companies, and pension funds. In addition, they help people get US green cards and ultimately US citizenship through the US government’s EB-5 Immigrant Investor Visa Program.

“Basically we look for people who want to move to the United States and we help them do so legally by investing and the nice thing is, with our program, they are also able to get a nice return on investment,” he says.

According to Lippincott, for a $500,000 investment that creates 10 jobs for American workers, you could get a green card in about two years and be a US citizen in about six or seven years. “Twenty seven countries have an investor visa program but with most of them, it’s essentially a fee you pay, or you need to be actively engaged in the day-to-day operation of a business. For example, you invest $1.5 million in Australia, but you need to hire employees and generate a certain amount of revenue. One of the biggest advantages with our program is you actually invest the $500,000 into a fund. We act as a trustee of that money and within five to seven years, they get that money back with a bit of return on investment and you are a permanent citizen in the US.”

Atlantic American Partners invests the money in real estate developments like hotels, apartments and student accommodation.

“What’s nice about the program is it doesn’t only cover the investor; it covers the spouse and children under 21. Our biggest family was a Hungarian family with seven children so they got nine green cards for $500,000,” says Lippincott.

The company says it has had positive response in South Africa. “Two months ago, we were here and we had scheduled six presentations for 100 people and we ended up speaking to 450 people. Most were business people, people worried about the economy, people worried about the political future of South Africa and people concerned about the education future of their children,” says Ryan.

According to Lippincott, despite the news of the clampdown on immigration, the US economy is booming and will perish without immigration. In the era of Donald Trump and his anti-immigrant views, that’s heartening news indeed.

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