South Africa needs more investment to drive economic growth, create jobs and improve competitiveness. Yet investment decisions are often influenced by policy, regulatory and administrative barriers that are not always visible through formal reporting channels. Businesses frequently know exactly where these obstacles lie, but that information does not always reach policymakers in a structured and actionable form.
To help address this gap, the Policy Innovation Lab at Stellenbosch University developed the Identifying Barriers to Investment Tool, known as iBIT.
iBIT is a WhatsApp-based AI chatbot that allows business representatives to describe the policy barriers affecting their investment decisions. The tool was developed by the Policy Innovation Lab in collaboration with the Policy and Research Services branch in The Presidency of South Africa.
The purpose of iBIT is straightforward. It gives businesses a direct and accessible way to explain which policies, regulations or administrative processes are holding back investment, how much investment is affected, what form that investment would have taken and which reforms they believe would make a difference. This approach enables the Lab to collect detailed conversational data that can be converted into structured evidence for policy analysis.
AI is used at two stages of the process. First, it powers the WhatsApp chatbot, guiding respondents through a structured yet conversational interaction. Second, AI-assisted analysis helps classify responses into themes, identify financial impacts and extract reform proposals from the raw text.
Human oversight remains a non-negotiable part of the process. Privacy was also central to the design of the chatbot. iBIT does not request personal information such as business names or mobile numbers. If respondents choose to share identifying information, the data is automatically de-identified before analysis. The aim is not to replace policy judgement, but to improve the quality, scale and speed of the evidence available to decision-makers.
In 2025, a proof-of-concept pilot was launched in the Western Cape in partnership with Wesgro. The objective was to test whether businesses would voluntarily use this type of tool, whether the data could be translated into policy-relevant findings and whether the privacy safeguards would work in practice.
The iBIT WhatsApp number was distributed through Wesgro’s business network and generated 64 interactions from 35 unique respondents. A significant proportion of respondents provided detailed qualitative accounts, with many responses exceeding 1,000 characters.
The pilot identified several recurring barriers to investment. Broad-Based Black Economic Empowerment (B-BBEE) policy was the most frequently cited issue, raised by 52% of respondents. Transport and port infrastructure failures, primarily linked to Transnet, were raised by 33%. Tax burden and fiscal policy were identified by 28%, while access to finance and development funding was raised by 23%. Respondents also highlighted concerns relating to energy supply, labour regulation, municipal red tape, procurement processes, immigration policy and regulatory uncertainty.
Businesses reported substantial investment being delayed or withheld because of these barriers. Reported amounts ranged from R200,000 to R1 billion, with one US-based company indicating that it had withheld an investment of USD 247 million.
The value of the pilot, however, extended beyond the amounts reported. Many respondents proposed specific reforms, including changes to the VAT registration threshold, clearer turnaround times for development finance applications, a single compliance portal across public agencies and reforms to procurement systems and port logistics.
On 4 June 2026, a report detailing the findings of the pilot was launched at an event hosted by the Policy Innovation Lab. Participants joined from across South Africa and represented a wide range of institutions, business organisations, industry bodies and sectors. The event provided an opportunity to discuss the pilot findings, assess the usefulness of the tool with a broader audience and explore how the approach could be expanded beyond the pilot phase.
Following the success of the pilot, attention is now turning to the national rollout of iBIT. Through partnerships with chambers of commerce, industry associations, investment promotion agencies and other business networks, the Lab will invite businesses across South Africa to report the policy barriers affecting investment.
As the dataset grows, iBIT will help identify recurring obstacles, direct issues to the appropriate level of government and support more evidence-based policy reform.
For the Policy Innovation Lab, iBIT demonstrates how AI can be used responsibly in public policy. It provides a scalable way to listen to businesses, protect respondent privacy and transform practical experience into policy-relevant insights. Used effectively, this approach can contribute to a more responsive policy environment and a stronger investment climate in South Africa.

• This article was drafted using human expertise supported by AI-assisted writing tools.

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