Not the end of the world
Global uncertainty may offer up long-term opportunities
Global uncertainty is just about the only certainty in 2017, but it may bring opportunity, writes Johann Barnard
Generally speaking, six years is not an unreasonable time horizon over which to expect some growth in an investment portfolio. For SA investors though, the past six years have been devastating for the performance of the rand against the US dollar. In the six years from February 1 2011 to February 1 this year, the rand declined by close on 50%, from R7.12/$ to R13.4/$. During this time, the country and currency also had to weather the shock firing of finance minister Nhlanhla Nene in November 2015, which sent the rand into free fall. We have become so accustomed to the rand being bullied by hard currencies like the dollar that it’s difficult to remember when last the exchange rate was in single digits against the greenback. For the record, that was around October 2013.
It is within the context of the steady — and at times accelerating — decline of the rand that the question of offshore investment raises its head. This is far from a cut and dried argument in favour of offshoring...
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