• Caught in the debt trap?

    Help us help you by taking our second annual Debt survey and you could win R3 000.

  • Rich man, poor man

    Culture change from below is the only way to overcome poverty, says Leopold Scholtz.

  • Tech bubble talk

    After the tech euphoria of 2013, the fast-moving sector has hit a speed bump.

Data provided by McGregor BFA
All data is delayed
Loading...
See More

Foreign direct investment to SA plummets

Oct 24 2012 07:59 Reuters

Related Articles

Davies in China for export expo

Manuel sets out plan for rural growth

'Dark days' loom for SA mining

SA to get 18 infrastructure projects

Davies: SA needs to look south

SA is getting many things right - govt

 

Johannesburg - Foreign direct investment flows to South Africa tumbled 43.6% in the first half of 2012 compared to the same period last year, while FDI to the continent as a whole rose by 5%, a United Nations report said on Tuesday.

The decline in FDI to Africa's biggest economy came amid an 8% drop in global FDI inflows due to heightened global economic uncertainty, according to the UN's Global Investment Trends Monitor.

As South Africa battles the worst labour unrest since the end of apartheid, the numbers suggest it will face increased competition for investment from its faster-growing neighbours.

The report said FDI inflows to South Africa fell to $1.7bn in the first six months of 2012 from $3bn in the first half of 2011, reflecting sluggish domestic economic growth as well as a slowdown in developed economies.

"It reflects the situation in the main investors in South Africa (which) are developed countries," said Astrit Sulstarova, an economist at the UN's Conference on Trade and Development (UNCTAD), which produced the report.

Slow economic growth in South Africa could also be influencing investment decisions, Sulstarova added.

The IMF forecasts South African GDP growth of 2.6% this year, and recently cut its 2013 growth forecast to 3% from a July projection of 3.3%, due to its close links to struggling Europe.

The IMF has also trimmed its 2012 forecast for Africa to 5% from 5.4%, but raised its projection for 2013 to 5.7%  from 5.3%.

FDI flows to Africa grew 5.1% to $23.1bn in the first half of 2012 after three consecutive years of decline, the UNCTAD report said, citing a return of investor confidence to North Africa, especially Egypt.

Globally, FDI inflows reached $668bn in the first half of 2012, down 8% from the same period in 2011, due to a decline in inflows to the United States and the BRIC countries - Brazil, Russia, India and China.

However, China was still the world's largest recipient of FDI, with inflows of $59.1bn in the first half.

For the first time, developing countries accounted for half of global FDI inflows, UNCTAD said, with Latin America and the Caribbean attracting greater investment along with Africa.

Flows to Europe as a whole increased by 5.7%, but the European Union experienced a decline of 3.8%.

 
sa economy  |  foreign investment
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
71 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're Talking About: Small Business

Standard Bank is looking for 12 entrepreneurs to participate in a 10-part TV series. They could win a R1m investment into their dream.
 
 

The rich will pay - Mpofu

The EFF in Gauteng will focus all its energy on improving the lives of the poor, the party's premier candidate Dali Mpofu says.

 
 

Latest elections multimedia

Watch what happened when we blindfolded Helen Zille and asked her to eat random things
13 days to elections - news you need to know
11 Julius Malema quotes you'll never forget
DA won't get 30% - Zille

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...