Foreign investment: agriculture maintains its appeal

South Africa remains a popular destination for foreign investors, despite an often negative outlook from its citizens. It is a gateway to Africa, and with its counterseasonal production to the Northern Hemisphere and favourable weather, local agriculture is especially well placed to attract foreign interest, bringing with it hope for rural communities

- Lindi Botha

South Africa attracted R100 billion in foreign direct investment (FDI) last year, equal to 1,4% of the country’s gross domestic product (GDP).

“South Africa has many positive attributes for foreign investors,” says Olusegun Zaccheaus, leader of PwC West Africa’s consulting business, Strategy&.

In its South Africa Economic Outlook report for 2024, PwC notes that the perception among non-residents of South Africa’s public governance and business ecosystem is ‘moderately positive’ on average.

“South Africa’s performance is near the middle of the pack when countries are ranked, not as dismal as some might think, and in the company of countries like Malta, Croatia and Slovakia,” says Zaccheaus.

The manufacturing industry holds the largest share of foreign investment (38,5%), followed by mining (24,2%), and financial services (20%). South Africa’s factory industry is home to production facilities owned by some of the world’s largest producers of vehicles and food, among other products.

Zaccheaus notes that, despite its challenges, the South African economy is more diversified and stable compared to many other African economies. “The country has a very strong financial services and capital market, which is more sophisticated than most markets in Africa.

“Furthermore, South Africa’s banking industry offers clients access to a comprehensive suite of financial instruments and services alongside a robust banking regulatory framework that ensures the safety and soundness of financial institutions and their clients,” he says.

Bruce Hamilton, CEO of Verdant Orchards, knows this all too well. In October 2024, the company acquired the Noordgrens farm in Limpopo, which has 800ha of citrus in production, adding to its portfolio of farms across the Southern African Development Community region.