South Africa’s foreign companies to be included in SA indices

South Africa’s foreign companies to be included in SA indices

An October announcement by the South African National Treasury that foreign-domiciled listings on the JSE will now be classified as domestic assets for exchange control purposes may improve the country’s position as a financial gateway into Africa and allow local asset managers to invest more freely in these companies.

In the past, the JSE could not include foreign companies in the exchange’s indices, as local investors weren’t able to buy the shares without restriction. This in turn limited the amount of local activity in the foreign companies and hence detracted from the JSE as an investment destination. The change in policy direction enables the JSE to more aggressively pursue a wider range of investment possibilities.

The South African National Treasury Steps also announced that it will simplify procedures and reduce the cost of cross-border money remittances, particularly to neighbouring countries and the rest of Africa.