South Africa’s foreign direct investment rises USD1.74 billion in first quarter

The Central Bank of South Africa said on Thursday that South Africa's foreign direct investment (FDI) inflows rose in the first quarter of 2020, to 29.0 billion rands (USD1.74 billion) compared to inflows of 10.5 billion rands in the final quarter of last year, according to a news report by Naija 247 News.

In a quarterly bulletin, South African Reserve Bank (SARB) said, " South Africa's direct investment liabilities increased … mainly as a result of the foreign acquisition of a domestic manufacturer and distributor of food and beverage products."

Local competition authorities approved the United States food giant PepsiCo's USD1.7 billion takeovers of food and drinks producer Pioneer Food Group in February.

At the same time, portfolio investments, reflecting a record of buying and selling securities such as bonds and shares, showed a sharp outflow, of 97.6 billion rands in the first quarter compared to inflows of 9.3 billion rands in the fourth quarter of 2019.

Non-residents sold bonds worth 74.4 billion in the first quarter while selling 23.1 billion rand inequities, the bank said in the analytical release.

South Africa saw aggressive selling of government bonds in March and April as the novel coronavirus struck, forcing the central bank to enforce emergency liquidity measures and launch a quantitative easing style purchase of bonds in the secondary market.