Global Firms Expand in South Africa as Economic Outlook Brightens
SOUTH AFRICA: Several international companies are acquiring South African-based businesses as economic prospects show a notable improvement compared to a year ago.
In 2024, however, numerous global firms either closed or scaled back their operations in South Africa. French-based BNP Paribas ceased its banking operations in early 2024 as part of a global strategy. Similarly, UK-based HSBC announced the sale of parts of its South African operations to FirstRand and Absa. Shell disclosed plans to sell its downstream business in the country, including its petrol station network, while Anglo American unveiled intentions to unbundle Anglo American Platinum amid difficulties in the Platinum Group Metals (PGM) sector.
In addition, BritBox ceased its South African operations, and Rolex closed its official affiliate in the country. These developments came during a challenging period, with the South African economy projected to grow by less than 1% in 2024.
Despite these setbacks, investor confidence has surged due to a decline in load shedding and the establishment of the Government of National Unity (GNU). The second half of 2024 saw strong performance in South African equities, bond yields, and the rand. While global markets have faced heightened volatility following the return of US President Donald Trump, South African assets have remained relatively stable compared to other emerging markets. Consequently, despite the closures announced in 2024, several international companies are now increasing their presence in South Africa through strategic acquisitions.
Source: Business tech