FOREIGN DIRECT INVESTMENT
Structure is business-friendly, but new laws are not
The government continues to pursue legislation that is not friendly towards investors
On Friday, President Jacob Zuma will launch Invest SA, a one-stop shop service for foreign investors. An initiative of the Department of Trade and Industry, Invest SA is tasked with promoting investment in SA. It was mentioned in the state of the nation address as part of an attempt to characterise SA as an investment-friendly destination. Zuma said it would focus on investment promotion and facilitation, reducing "undue delays" and "unnecessary red tape". However, local and foreign investors are likely to remain cautious about the president’s promises. SA has suffered an alarming decline in foreign direct investment (FDI). According to research by the UN Conference on Trade and Development, SA’s annual FDI inflow dropped 74% in 2015 to $1.5bn from $5.7bn in 2014 and is at its lowest level in 10 years. BMI Research expects this trend to have continued in 2016 and to continue into 2017. It indicates that business confidence in SA as an investment destination has severely deteriorated...