· The continued geopolitical tensions sparked by the Ukraine war has impacted the flow of Foreign direct investment (FDI) to South Africa. FDI of R26.2bn in the second quarter was significantly lower from R39.9bn in the first quarter according to the Reserve Bank’s quarterly report.
The continued geopolitical tensions sparked by the Ukraine war have impacted the flow of Foreign direct investment (FDI) to South Africa. FDI of R26.2bn in the second quarter was significantly lower than R39.9bn in the first quarter according to the Reserve Bank’s quarterly report. The fall in the FDI reflected foreign companies giving loans to and increasing equity investments in domestic subsidiaries said SARB. The higher inflows in the earlier quarter were attributed to overseas investors buying more debt securities than they sold domestic equities.
Central bank data also showed that household debt levels rose, while consumption expenditure slowed. In the April-June quarter, inflation rose due to increased food and fuel costs and higher interest rates hurting disposable incomes. Gross domestic product contracted 0.7% quarter on quarter in the second three months of the year.
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