Nedbank CEO says South Africa still investable
South Africa is still investable despite the multiple crises the country faces and the government’s slow implementation of reform.
This is feedback from Nedbank CEO Mike Brown, who told CNBC Africa on the sidelines of the World Economic Forum it has been difficult presenting the South African investment case.
In its Future of Growth report, the World Economic Forum laid bare South Africa’s economic plight.
The report showed that South Africa’s economy is not competitive globally. It is below average on three of the four key indicators that the WEF considers vital to economic prosperity.
Sustainability was the only indicator where South Africa scored above the global average, falling significantly short on innovativeness, resilience, and inclusiveness.
The country does not fare any better on traditional indicators of economic prosperity such as economic growth, GDP per capita growth, government debt, and life expectancy.
All of these indicators have deteriorated, with South Africa’s economy stagnating while its government debt has skyrocketed and population boomed.
When asked why he travels to Davos, Brown said he does so to learn about the latest business trends, network with global CEOs, and present South Africa’s investment case.
“It is about presenting the South African investment story. It is difficult right now – absolutely. But, we do have a story to tell about fixing the electricity crisis, logistics, and crime and corruption,” he said.
“The big picture story for South Africa is a country with extraordinary potential from mineral resources to tourism to the financial sector.”
“At the same time, the real-world delivery over the past few years has been poor. Economic growth has fallen to below population growth.”
While the major hurdles to strong economic growth are the electricity shortfall, the logistics crisis, and crime and corruption, a set of longer-term issues are starting to become prevalent.
These include the deterioration of water infrastructure, resulting in parts of the country having access to no water, unsafe water, and a poor government education system.
“Certainly, as business, we would want accelerated delivery of government’s stated economic policies because that is what is hindering economic growth.”
Brown also said that uncertainty plays a big role in preventing foreign investment in South Africa.

Brown’s comments echo those of Investec South Africa CEO Richard Wainwright, who said that policy uncertainty is the main factor behind a lack of investment in South Africa.
“The issues are around uncertainty, particularly about policy frameworks. The continent and South Africa in particular have a lot of work to do on that front,” Wainwright said.
Increased uncertainty results in increased volatility in financial markets, which results in investments not being made.
He explained that high levels of uncertainty have a chilling effect on investment deals, with decisions effectively being put on hold.
“It is policy certainty that will be the key driver for investment,” Wainwright said.
South Africa’s policy uncertainty has steadily increased over the past decade, resulting in lower investment, higher unemployment, and sluggish economic growth.
This was revealed by the North-West University (NWU) Business School in its quarterly Policy Uncertainty Index.
The index showed that uncertainty eased to 65.5 in the fourth quarter of 2023 from 71.8 in the third quarter.
Levels above 50 reflect growing policy uncertainty, while levels below 50 indicate policy uncertainty is declining.
The report said policy uncertainty would only drop below 50 when positive forces significantly outweigh negative forces.
In its report, the NWU Business School said there are strong correlations between policy uncertainty and negative economic outcomes.
High levels of policy uncertainty lower investment, employment and, subsequently, economic output. This results in sluggish economic growth in South Africa.
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