- Foreign direct investment (FDI) into South Africa grew by 446% to $7.1 billion in 2018.
- This after sharp declines in FDI since 2014.
- President Cyril Ramaphosa aims to attract $100 billion in FDI by 2023.
Foreign direct investment into South Africa grew from $1.3 billion in 2017 to $7.1 billion (R98.6 billion) in 2018 - an increase of 446% - a new United Nations report found.
In February 2018, newly elected president Cyril Ramaphosa said he aims to attract $100bn, or about R1.4 trillion, investment to South Africa by 2023.
The UN Conference on Trade and Development (UNCTAD) Global Investment Trends Monitor report, released on Monday, said South Africa successfully managed to turn around the sharp declines in FDI since 2014.
It said FDI investments were predominantly devoted to mining, petroleum refinery, food processing, information and communications technologies, and renewable energy.
Last year, China committed to R193 billion in new investments in South Africa. One of the biggest Chinese investments in South Africa was the recently-opened $840 million (R11 billion) BAIC vehicle plant at the Coega harbour.
Saudi Arabia said it would invest $10 billion - specifically in the energy sector, including building refineries, petrochemicals and renewable energy.
Among the companies that announced they would pump new money into South Africa, was Mercedes Benz, which said it would invest R10 billion.
Despite the increase in FDI, the World Bank expects that the South African economy will grow by a meagre 1.3% in 2019.
The report found that African FDI grew from $13.4 billion to $13.9 billion, or 6%, predominantly helped by growth in South Africa and Egypt.
FDI in Southern Africa grew to $4.5 billion in 2018, while global FDI fell to an estimated $1.2 trillion in 2018 from $1.47 trillion in 2017.
The drop, the third in three years, brings FDI flows back to the low point reached after the global financial crisis.
“The factors behind this negative trend, such as lower profitability of foreign investment and shifts in global value chains, are not changing in the near future," James Zhan, Director of UNCTAD's Investment Division, said in a statement.
“The macro-economic backdrop is also deteriorating.”
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