What kind of companies and countries are investing in South Africa in your experience?

I think to a large extent, foreign investment has been relatively slow. Maybe the first one to come back into South Africa was IBM, which is a good example. The initial investment that one has seen has been companies that invested prior to the sanctions era, that have maintained links with suppliers and then have come back to reinvest into South Africa. But I think it has been fairly limited.

Why do you think that is?

I think the exchange controls are still a deterrent. I think that foreigners don't like to invest in a country where there are exchange controls.

There have been other significant deals. You have Petronas from Engen, a local petroleum company, which is a Malaysian group that has invested in SA. We've also seen some investment from Malaysia taking place, maybe because they've had some sort of exchange control themselves, so they are less reluctant to invest. But the exchange controls along with the potential weakness in currency have been factors which have limited investment.

What ways are there of investing in South Africa beyond acquisition?

It's either as a start up, or potentially entering into a joint venture with a domestic company. There are lots of opportunities for joint ventures out there.

Are South African companies seeking to invest in foreign countries more?

I think it's happening on a selective basis. Companies like Bersetel, a local IT company, have made big acquisitions in Germany. A number of companies have looked at Australia, including the large mining house Gencor. So mostly Europe and Australia. I think the US is more difficult to get into. There has also been investment into mining companies where there are exploration possibilities around Africa.

How has the Rand's periods of strength and weaknesses affected cross-border investment?

The big problem with doing a cross border deal is being able to finance it abroad, because of exchange control restrictions. South African companies cannot and could not in the past repatriate funds offshore, so they couldn't raise capital in South Africa and then send it offshore to fund acquisition. Only recently have they started to allow borrowing against the strength of the South African balance sheet to be used in foreign acquisitions. So I think the strengths and weaknesses of the Rand may have been factors impacting on it, but it has really been the ability to raise acquisition finance offshore that has affected cross-border investment.

Haven't exchange controls been reduced of late though?

They have had limited reductions in the controls, but it's not entirely done. I think there is an intention to remove the exchange controls.

Given the problems you've been talking about wouldn't you like to see them totally eliminated?

Absolutely. Every South African businessman would want to see the end of them. I would say they haven't been eliminated so far because of concerns about the country's reserves, the potential flight of capital, and concerns about political instability.

Do you think the Government has done enough to attract foreign investment?

I think at the moment probably not. Simply because the exchange controls are there. Also I don't think the tax regime is necessarily that attractive to foreign investors. There are some incentives, but I think on balance while the exchange controls are still there they will deter investment.

What recent developments have there been in domestic mergers and acquisitions activity?

I think in general there is a huge amount of corporate restructuring taking place - unbundling as we call it. Also Black empowerment is a major factor in South African business. Black groupings are getting opportunities to participate in South Africa business by investing.

How does that process touch on your business?

We look for opportunities for our black empowerment groupings as clients, and we try and actively work with them in finding the right funding mechanisms. Black groupings don't necessarily have cash available to invest, so it's finding the right structures to facilitate that.

What would you like to see five years from now to increase foreign investment?

As well as the lifting of the exchange controls, which would have a hugely positive effect, we need political stability and to create a friendly investment climate. I think crime in South Africa has been noted to deter investment. German companies - how many German executives have been victims of crime? Those sort of things don't create a positive investment climate.

Are the international business community's perceptions of terribly high crime rates in South Africa justified in your view?

I think so. I think the Government has taken some bold steps to reduce it. They have appointed a businessman as the head of the police, which is very positive and very encouraging, but I would say at the moment it is still a problem.