Ireland and South Africa ‘can benefit from stronger economic ties’

Irish and South African companies can benefit equally from the work being done to strengthen economic ties between the two countries, according to former South African reserve bank governor Tito Mboweni.

Mr Mboweni, a speaker at the third annual Africa Ireland Economic Forum in Dublin this week, stressed the scope for economic growth that could be derived from a mutually beneficial partnership between both countries.

Direct investment in Ireland by South African companies stands at only 9.2 percent of the total amount channelled into the country, he said, with the major portion – 90 per cent – coming in the form of portfolio investments. "There is a large amount of South African funds invested in the Irish financial markets," he said.

'Spike in investment'

Mr Mboweni said while Ireland had experienced significant economic difficulties in recent years, he was confident the country would overcome them, and that the improving economic investment climate would be attractive to African companies.

“The next 10 to 15 years will see a major spike in investment flows [into Ireland]€2.7 billion in 2011, an increase of 200 per cent since 2009, but trade with the continent is expected to reach €24 billion by the end of the decade.

Mr Mboweni said sub-Saharan African economies were growing at about 6 per cent a year. "There is major growth in Nigeria, Ethiopia, Ghana, Angola and Mozambique, which is currently an $18 billion GDP economy, but in the next 15 years it has the possibility of becoming a $50 billion GDP economy due to its oil and gas finds."