South Africa: Trading international investment for policy space
Stellenbosch Working Paper Series No. WP04/2016Publication date: 2016
Author(s):
The overall trend since 1994 of growing foreign direct investment into South Africa has been a reflection of the country’s openness to investment as well as significant international trust in its institutions. Recent policy and legislative developments, including the termination of South Africa’s bilateral investment treaties with EU trading partners and the introduction of the Protection of Investment Act, are however raising concern among international investors and bringing into question the attractiveness and reliability of South Africa as a destination for foreign investment. These concerns have been compounded by increasing regulatory restrictions upon foreign investors, including stricter visa requirements, and the introduction of various other pieces of legislation that have implications upon the level of protection of property rights in South Africa. A policy shift, reflected in legislation such as the Protection of Investment Act, the Private Security Industry Regulation Amendment Bill and the Expropriation Bill, indicates an enhanced focus on the public interest aspect of the constitutional right to property in accordance with the government’s constitutionally mandated transformative agenda. A balance needs to be found between the government’s sovereign right to implement domestic policies in order to achieve its socio-economic goals, its duty to protect foreign investments, and its overall objective of promoting sustainable economic growth.
JEL Classification:K10, K11, K33, F21
Keywords:South Africa, foreign investment protection, expropriation, policy space, bilateral investment treaties, Protection of Investment Act, Constitution
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Upcoming Seminars
Monday 21 July 202512:00-13:00
Izak Odendaal: Old Mutual Wealth Chief Investment Strategist
Topic: "Diverging fiscal policies and what it means for markets"
12:00-13:00
Dr Neil Rankin: Ceo Of Predictive Insights & Stellenbosch University
Topic: "TBC"
12:00-13:00
Prof Willem Boshoff: Stellenbosch University
Topic: "Two competing approaches in South African competition policy: merger control and anti-cartel enforcement over the past 30 years"
BER Weekly
27 Jun 2025 Another setback for the GNU, but oil markets breathe a little easierThis week was marked by heightened tensions both domestically and internationally. At home, friction intensified between the two largest parties in the Government of National Unity (GNU), the ANC and the DA, following the firing of one of the DA's deputy ministers. Internationally, the US conducted airstrikes on three Iranian nuclear facilities using...
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