South Africa’s investor appeal is experiencing a robust recovery under the two-month old government of President Cyril Ramaphosa, the country’s Reserve Bank Governor Lesetja Kganyago said on Thursday.
Since Ramaphosa took power, both business and consumer confidence have improved, Kganyago told CNBC’s Joumanna Bercetche at the IMF and World Bank spring meetings in Washington.
The positive momentum is also reflected in financial markets. “We saw bond yields decline, the currency strengthen so there is positive investor sentiment in South Africa and that, of course, lays a basis for a cyclical recovery,” Kganyago said.
Ramaphosa, the successor to embattled former leader Jacob Zuma, is widely regarded as a pro-business politician committed to fighting graft and boosting foreign investment. Once a top performing emerging market, the economy took a hit under Zuma, who was criticized for heavy government interference in business affairs.
Also encouraging was the government’s tabling of a budget, which is setting a path for fiscal consolidation, and the fact that Moody’s revised its credit outlook to stable from negative last month, Kganyago continued.
Ramaphosa this week announced a drive to attract more than $100 billion in foreign investments — a target that Kganyago called “aspirational.”
While the country has been enjoying steady portfolio investment, foreign direct investment will take longer, the central bank head said, adding that once a suitable domestic environment is created, Ramaphosa’s goal will be achievable.
Get the best of CNBC Africa sent straight to your inbox with breaking business news, insights and updates from experts across the continent. Sign up here.