South Africa grows, but where’s the FDI

The SA economy is growing at between 4.5 to 5.5 percent, depending on which quarter was last measured, according to Business Report. My question is, if we have such growth where is the fixed direct investment (FDI) that overseas companies should be putting in here?

For me, it specifically relates to software vendors. Back in the mid- to late-1990s, US and European software firms of all sizes were coming to SA to open offices, and in those days we didn’t have the growth we are seeing now.

For South American or Asian countries having such growth for an extended period (as we have had), I’m sure the vendors would be piling in. My slightly cynical perspective is that because this is Africa, investment is seen as a risk by foreigners, no matter how the economy is performing.

It surprises me that the European companies in particular are not here in more numbers, because they are more familiar with Africa. I started to give up on US companies several years ago when I realised that Americans have very little idea of what goes on in the world apart from a fairly selective number of countries.


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