{"id":64312,"date":"2024-04-16T06:09:55","date_gmt":"2024-04-16T06:09:55","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years"},"modified":"2024-04-16T06:38:55","modified_gmt":"2024-04-16T06:38:55","slug":"south-africa-lost-r1-trillion-in-10-years","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years","title":{"rendered":"South Africa lost R1 trillion in 10 years"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>Foreign investors have taken R1 trillion out of South Africa in the past decade, as the country\u2019s assets produce poor returns compared to global peers due to an uncertain regulatory environment.<\/p>\n

This is feedback from Old Mutual chair and former finance minister Trevor Manuel, who wrote in the company\u2019s annual report that South Africa is struggling to compete for investment globally.<\/p>\n

Manuel said that the effects of state capture continue to be felt across South Africa, and while there has been an effort to restore institutions and rebuild the economy, more work is desperately needed.<\/p>\n

\u201cAgainst this backdrop, it is crucial that regulators adopt a pragmatic approach, striking a balance between fiscal requirements and providing clear regulations and long-term regulatory certainty,\u201d he said.<\/p>\n

Manuel noted that over the past decade, foreign investors have disinvested over R1 trillion from South African equities and bonds.<\/p>\n

The main driver has been regulatory uncertainty and \u201cexecution status\u201d, with the government\u2019s reform programme taking far too long to implement.<\/p>\n

\u201cThis money is being redirected to competing markets that appear to have a more sound governance and regulatory foundation.\u201d<\/p>\n

\u201cThis is a stark reminder that Africa, particularly South Africa, has to compete to attract and retain investment,\u201d Manuel said.<\/p>\n

He warned that the country\u2019s national election on 29 May will only add to South Africa\u2019s uncertainty and make investors more hesitant to invest locally.<\/p>\n

This year\u2019s election is set to be the most fiercely contested in South African history, with the ANC poised to lose its majority and a coalition government likely to govern the country.<\/p>\n

Old Mutual said it is willing to collaborate with regulatory authorities and the government to create an environment conducive to business growth and investment.<\/p>\n

South Africa being left behind<\/p>\n

Manuel\u2019s comments echo those of Standard Bank CEO Sim Tshabalala, who said South Africa is losing ground to its African peers as many of their economies are more attractive to investors.<\/p>\n

Tshabala said the country has incredible competitive advantages but has failed to capitalise on them. He called for the state to improve its efficiency to capitalise on them.<\/p>\n

\u201cPlease improve the quality of our institutions. In the case of South Africa, we use the lovely phrase \u2018Please capacitate the public sector\u2019.\u201d<\/p>\n

\u201cSome parts of the public sector are excellent, such as the National Treasury and the Reserve Bank. Replicate what is happening in those across the board,\u201d Tshabalala said.<\/p>\n

\u201cPlease capacitate the state,\u201d he repeated. \u201cPlease professionalise it. Please continue to make doing business easier.\u201d<\/p>\n

Tshabalala explained that South Africa is involved in a global competition with its African counterparts and other emerging markets for scarce capital to drive economic development.<\/p>\n

\u201cThe world competes for capital. We compete for the money we need to finance our nation\u2019s budget deficit and compete globally for the money to finance infrastructure investment, fund Eskom and Transnet, and finance corporate projects.\u201d<\/p>\n

The biggest factor in attracting capital is the country\u2019s risk premium, which dictates the returns an investor should expect when taking on the risk of investing in a given country.<\/p>\n

This directly impacts a country\u2019s ability to raise capital and the companies that operate in it. As this premium increases, which it has in South Africa, it makes it more difficult to attract investments in local businesses and finance the government\u2019s deficit.<\/p>\n

\u201cWe are competing on the continent and with emerging markets for this capital. So if they have decreased the risk of investing in their country and generated greater returns, the money will then rather go to those places than South Africa,\u201d Tshabalala said.<\/p>\n

The key factor is the rate at which the economy is growing. South Africa is expected to grow at less than 1% in 2023, while other African countries will average greater than 3% growth.<\/p>\n

\u201cWhat does this mean? It means that we are losing our national competitive advantage. We need to grow faster and get people healthier and wealthier,\u201d Tshabalala said.<\/p>\n

A richer population will also generate more capital to invest locally and drive further economic growth.<\/p>\n

\u201cWe are growing at 0.8%. Other countries are growing much faster. Where do you think that money is going to go? It is going to go to other countries and not South Africa.\u201d<\/p>\n

For More News And Analysis About South-Africa<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. Foreign investors have taken R1 trillion out of South Africa in the past decade, as the country\u2019s assets produce poor returns compared to global peers due to an uncertain regulatory environment. This is feedback from Old Mutual chair and former finance minister Trevor Manuel, who wrote in the company\u2019s annual report that […]<\/p>\n","protected":false},"author":84,"featured_media":64311,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[274,315,275],"class_list":["post-64312","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-africa-press","tag-africa-press-south-africa","tag-south-africa-2"],"yoast_head":"\nSouth Africa lost R1 trillion in 10 years - South Africa<\/title>\n<meta name=\"description\" content=\"Foreign investors have taken R1 trillion out of South Africa in the past decade, as the country\u2019s assets produce poor re ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Africa lost R1 trillion in 10 years\" \/>\n<meta property=\"og:description\" content=\"Foreign investors have taken R1 trillion out of South Africa in the past decade, as the country\u2019s assets produce poor re ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-04-16T06:09:55+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-04-16T06:38:55+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/04\/sm_1713236845.468442.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"675\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"South Africa lost R1 trillion in 10 years\",\"datePublished\":\"2024-04-16T06:09:55+00:00\",\"dateModified\":\"2024-04-16T06:38:55+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\"},\"wordCount\":727,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/04\/sm_1713236845.468442.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-South-Africa\",\"South-Africa\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-lost-r1-trillion-in-10-years\",\"name\":\"South Africa lost R1 trillion in 10 years - 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