{"id":209255,"date":"2017-11-06T13:33:11","date_gmt":"2017-11-06T11:33:11","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=209255"},"modified":"2017-11-06T13:33:11","modified_gmt":"2017-11-06T11:33:11","slug":"avoid-hysteria-around-sas-struggling-economy-academic-warns","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/209255\/avoid-hysteria-around-sas-struggling-economy-academic-warns\/","title":{"rendered":"Avoid “hysteria” around SA\u2019s struggling economy, academic warns"},"content":{"rendered":"

Prominent academic Dr Conrad Beyers has cautioned against the advice by prominent economist Dawie Roodt<\/strong><\/a>, who urged South Africans to take their money out of the country.<\/p>\n

Beyers is the Barclays Africa Chair in Actuarial Science at the University of Pretoria, who was commenting in his personal capacity about Roodt\u2019s advice.<\/p>\n

Beyers noted that “physically taking money out of the country” is not the only way to protect savings against a weakening South African economy.<\/p>\n

According to Beyers, the advice by Roodt appears to be a “hysterical reaction” to recent events, adding that people\u00a0should be aware of the risks that accompany hasty decisions to take savings out of the country.<\/p>\n

Notably, interest rates are typically very low in developed countries, and exchange rate fluctuations can have a significant influence on the value of overseas savings.<\/p>\n

For example, typical interest on savings instruments in developed countries are much lower than in South Africa – in Australia it is around 1%.<\/p>\n

A weakening of the foreign currency can also severely damage the savings of South African residents.<\/p>\n

There are also other considerations, such as taxation and potentially large costs involved with transferring funds overseas.<\/p>\n

“There is no doubt that there are significant risks for the South African economy,” said Beyers.<\/p>\n

“South Africans should indeed strive not to put all their eggs in one basket – the key is to be careful and consider all possible risks that accompany major financial decisions,” he said.<\/p>\n

He added that exposure to international markets can indeed be very healthy, but highlighted that there exist many alternatives to physically moving funds out of the country.<\/p>\n

“Investment in JSE listed companies or unit trusts with significant international exposure is one way to hedge savings against a weakening South African economy,” said Beyers.<\/p>\n

“As an example, investment in many prominent JSE shares with international exposure would give South Africans a very healthy return over the past five years.”<\/p>\n

Another important consideration is the availability \u2013 i.e. liquidity – of savings. Savings invested overseas may often not be readily available to investors to withdraw.<\/p>\n

Investments such as JSE shares or other vehicles are typically highly liquid and can easily be available to investors.<\/p>\n

Beyers noted that it is understandable that negativety persists around the South African economy.<\/p>\n

“Roodt should, however, be careful not to draw many South Africans into making hasty and irresponsible decisions that could potentially put their savings at risk,” said Beyers.<\/p>\n

\n

Read:\u00a0It\u2019s time to take your money out of South Africa: economist<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Barclays Africa Chair in Actuarial Science, Dr Conrad Beyers has warned against the advice by prominent economist Dawie Roodt that people should take their money out of the country.<\/p>\n","protected":false},"author":10,"featured_media":168963,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[11347,1459,26],"class_list":["post-209255","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-conrad-beyers","tag-dawie-roodt","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/209255","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=209255"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/209255\/revisions"}],"predecessor-version":[{"id":209267,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/209255\/revisions\/209267"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/168963"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=209255"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=209255"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=209255"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}