INSTITUTE FOR INTERNATIONAL FINANCE
Uncertainties in SA ‘may curb capital inflows’
SA is likely to see a slight decline in foreign capital inflows in 2017, with confidence remaining weak and foreigners not likely to commit to significant investment in the country in the present uncertain economic and political environment. This is the word from the Institute for International Finance (IIF), which forecasts capital inflows of $10.9bn in 2017 compared with $12.4bn in 2016. In its latest quarterly report, the IIF predicts that capital inflows to emerging markets will be hardly higher than 2016, which saw emerging market inflows bounce back from a 12-year low in 2015, and it cautions that the "Trumpstorm" has increased the risks, particularly to foreign direct investment The IIF warns that investors will be much more discerning about emerging markets this year and that the quality of institutions matters for capital flows in an environment of political uncertainty. SA relies on sizeable inflows of foreign capital to finance the deficit on the current account of its ba...
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