HSBC Treasury Management Profiles 2018 -

Current section, Introduction


With an abundance of natural resources and some of the continent’s most developed financial markets, legal, manufacturing and communications sectors, South Africa is one of the two largest economies in Africa (alongside Nigeria). The country has achieved moderate economic growth since the 2009 recession, averaging 2.25 per cent 2010–2015. However, hindered by a slump in global commodity prices, and a severe drought which affected agricultural production nationwide, the country saw a significant decline in GDP growth in 2016 — GDP grew just 0.3 per cent in 2016 compared to 1.3 per cent in 2015. In Q1 2017, the economy went into recession contracting 0.7 per cent, following a contraction of 0.3 per cent in Q4 2016. However, there are signs that the country’s agricultural sector is recovering; the sector showed a 22 per cent increase in production in Q1 and a 33.6 per cent increase in Q2. This upturn in the agricultural sector helped drive GDP growth to 2.5 per cent in Q2, as did a recovery in commodity prices and exports. Despite the economic and political uncertainty in the South Africa (in October 2017, the IMF cut the country’s economic growth forecast for 2017 to 0.7 per cent from 1 per cent, citing ‘rising political uncertainty’ as the primary reason for this), the country remains an attractive destination for foreign direct investment (FDI). In 2016, FDI increased 38 per cent on the previous year, with the energy, telecommunications and services sectors attracting the most investment.

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Legal and regulatory

  • Foreign exchange accounts can be held by residents both domestically and abroad. Residents domestic currency (ZAR) accounts cannot be held abroad and are not convertible into foreign currency
  • Non-resident bank accounts are permitted in both foreign and domestic currency. Non-resident domestic currency accounts are convertible in to foreign currency
  • South Africa is a member of the Common Monetary Area (CMA) alongside Lesotho, Namibia and Swaziland. The ZAR is legal tender within the CMA and freely convertible with each CMA member state’s own currency

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  • Resident companies are taxed on their worldwide income with certain exemptions
  • Non-resident companies are taxed on South African-sourced income only
  • The standard rate of corporation tax is 28 per cent. No withholding or dividend tax is payable in respect of branch profit distributions
  • South Africa is a signatory to the Multilateral Competent Authority Agreement, under which information will be exchanged between tax administrations, giving a single, global picture on some key indicators of economic activity within multinational enterprises

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Payment instruments and systems

  • Cash is an important payment medium in South Africa, accounting for over 52 per cent of all transactions. Electronic credit transfers are used for both high-value corporate and low-value retail payment transactions. Cheque use is in terminal decline while payment card use is rising; transaction volume increased by 56 per cent in 2016. Mobile wallet schemes, such as SWAP Mobile, are available and increasingly popular
  • South Africa operates two national payment systems: SAMOS, an RTGS system, and the NPS. The NPS operates three subsystems: the ACB EFT, for low-value credit and debit transfers; the RTC, for one-off, low-value electronic credit transfers; and the CLC, for paper-based payments

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Cash management

  • Notional pooling and cash concentration is permitted. Cash concentration is restricted to resident ZAR accounts only. Cross-border notional pooling and cash concentration are not permitted
  • A range of collection services are available for both cash and cheques
  • The SADC regional cross-border settlement system, the SADC Integrated Regional Electronic Settlement System (SIRESS), operates across CMA member states. Customers in CMA countries can make cross-border payments via electronic credit transfers that are settled in real time through SIRESS

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Electronic banking

  • Internet and mobile banking services are provided by all of the country’s banks for both corporate and retail purposes
  • South Africa has one of the world’s highest mobile banking rates. Mobile penetration is in excess of 145 per cent

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To read the full report on South Africa and to discover more on these and other topics, including banking and trade, please click on the Download PDF option.


  • Statistics South Africa
  • World Bank
  • South African Revenue Service
  • South African Reserve Bank

The materials contained on this page were assembled in June 2017 (unless otherwise dated).



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