Industry leaders and economists gathered at the Houghton Hotel in Johannesburg for the CFA Society South Africa Annual Investment Conference. 

Themed, “2024: Investors at the Polls”, the event focused on global and local market shifts in light of major elections worldwide, which affect 49% of the global population according to Time. These elections are expected to have lasting impacts on economies for years to come.  The discussions ranged from debt restructuring in Africa to the transformative role of artificial intelligence (AI) and emerging opportunities in India and China.  Head of Alternative Investment Services, Cami Mbulawa and I represented RisCura at the event and engaged in the numerous discussions throughout the day. 

This article unpacks the topics presented at the conference, including: 

• African Debt Restructuring: Hope for the Future 
• The Artificial Intelligence Debate: Transforming the Global Economy 
• Fireside Chat with Tryphosa Ramano: Tackling Transformation and Investment 
• South Africa’s Future Prospects: A Panel Discussion 
• Keynote Speeches on China and India: Emerging Market Shifts 
• African Debt Restructuring: Hope for the Future 

African Debt Restructuring: Hope for the Future 

Patrick Chileshe, a country risk economist at Africa Trade and Investment Development Insurance (ATIDI), provided a detailed analysis of Africa’s ongoing debt restructuring efforts, which are inextricably linked to the continent’s history of commodity cycles. His insights highlighted how borrowing patterns from the 1980s and 1990s — driven largely by commodity exports and infrastructure development — have left many African nations grappling with unsustainable debt levels. He emphasised the unique challenges African countries face, such as high debt servicing costs, particularly in Zambia, Ghana, Ethiopia and Chad. Furthermore, he commented that 31 African nations are currently in debt distress, highlighting that the continent’s debt crisis remains a significant hurdle, especially as substantial amounts of African debt are set to mature in the next decade. 

He further highlighted the disparity between African nations’ debt burdens and their economic capacity to service them, noting Zambia’s particularly high debt service costs exceeding 14% of GDP revenues. A critical point raised was the need for local currency debt issuance to mitigate the risks of currency devaluation, a challenge many African nations struggle to balance. 

Despite these challenges, Chileshe underscored that frameworks like the G20’s Debt Service Suspension Initiative offer a window of hope, albeit with significant shortcomings that should be addressed, notably the signalling effect of being downgraded and its impact on other borrowing opportunities and costs. 

In the Q&A, Patrick Chileshe addressed Zambia’s load shedding, with 17 hours of daily blackouts, highlighting the government’s reluctance to appropriately price the new energy sectors. Questions also touched on tax burdens, noting Zambia’s low burden but skewed tax base, with potential to expand. Comparisons were drawn with Ethiopia, where the tax-to-GDP ratio is around 10%, also offering scope for broadening.  

While Chileshe’s insights into Africa’s debt restructuring are crucial, they underscore the pressing need for innovative financial solutions and more robust frameworks to manage debt sustainably, particularly given the continent’s complex economic landscape and historical challenges. 

The Artificial Intelligence Debate: Transforming the Global Economy 

The classic debate on artificial intelligence, moderated by Patrice Rassou, Chief Investment Officer at Ashburton Investments, saw two opposing views on whether AI would indeed transform the global economy. 

Dr. Musa Malwandla, representing the side in favour, argued that AI represents a technological revolution akin to past industrial revolutions. He compared it to historical innovations like the sewing machine and the knocker-uppers, who were once paid to wake people up by knocking on windows but were displaced by the invention of the alarm clock. Much like these examples, AI disrupts old systems while creating new opportunities.  

Similarly, he highlighted recent breakthroughs such as Google DeepMind’s research in protein structures. Before AlphaFold, predicting protein structures required years of labour-intensive experiments which were time-consuming and often led to incomplete or ambiguous results. This reduced the need for human-led experimentation and freed researchers to focus more on interpreting results and applying insights to real-world challenges, such as drug development and disease research. 

His optimistic view emphasised that while certain jobs will be displaced, AI would create new industries and streamline current workflows—citing South Africa’s shortage of 30,000 nurses as an area where AI could reduce administrative burdens and increase productivity. Supporting him, Viwe Tini stressed the opportunities available to the South African child, noting that access to a wealth of knowledge and tools enables them to achieve far more than was previously possible. 

On the opposing side, Claire Rentzke from Sukha and Associates and Futuregrowth’s Iqeraam Petersen raised concerns over AI’s limitations and risks, from deepfakes to its inability to match human intelligence or self-awareness. Petersen added a cautionary tale from his experience with an automated Amazon store, where behind-the-scenes human verification still played a major role. This point underscored the reliance of AI on human intervention, even in advanced applications, and the immense resources required for AI to achieve scalability. 

During the Q&A, I posed a question that I often think about, veering the conversation into the implications of AI for wealth concentration, job redundancies, and South Africa’s unique socio-economic context. When addressing the panel, I suggested whether there might be a role for a universal basic income to support those most affected by job displacement, noting that while work continues, wealth is becoming increasingly concentrated among AI and automation adopters. Dr. Malwandla addressed these concerns by referencing the Kuznet curve, suggesting that initial inequalities caused by AI may smooth out over time as wealth eventually spreads across the broader economy. Iqeraam highlighted the regulatory headwinds in South Africa that could potentially slow AI’s integration, particularly around labour laws. He stressed that these factors must be carefully navigated to avoid exacerbating inequality.  

There are massive benefits of accessibility to these advanced tools, noting that while they unlock unprecedented potential, they must be paired with critical thought to address ethical concerns and ensure inclusive growth. 

In South Africa, advanced AI tools offer tremendous potential for growth. However, to fully realise these benefits, I believe that it is essential to address ethical concerns and ensure that progress is inclusive and equitable for all. 

Fireside Chat with Tryphosa Ramano: Tackling Transformation and Investment 

In an engaging fireside chat, Tryphosa Ramano, a key player on several influential boards, candidly discussed South Africa’s path to transformation. She touched on Operation Vulindlela, a presidential initiative aimed at reducing inefficiencies and making South Africa more competitive. She was cautiously optimistic about the future, expressing hope that increased private sector collaboration could fuel reform. 

Ramano voiced her disappointment over the slow pace of Broad-Based Black Economic Empowerment (B-BBEE) implementation, noting that the approach to transformation has been slow and, in some cases, lacking substance. Her emphasis on mentorship and sponsorship for women and under-represented groups stood out as a key takeaway for industries looking to foster meaningful change. Her passionate call to action—backed by her “Seat at the Table” mentorship initiative—highlighted the need for greater sponsorship and empowerment of women in leadership. 

Ramano also shared insights on South Africa’s investment landscape, particularly the 45% offshore investment limit under Regulation 28. While this has allowed for increased offshore allocations, it has also inadvertently led to a reduction in local investments. With a larger portion of pension funds flowing out of the country, there is less capital available for domestic projects and industries.  

The discussion also led to the Two-Pot Retirement System introduced in South Africa as of the 1st of September. While it provides financial relief (and avoids the lengthy and sometimes creative measures people go through to access funds!), it has raised concerns about its long-term impact on investment. 

In her closing remarks, Ramano encouraged us – the corporate delegates – to master our craft with dedication and excellence. She emphasised that by honing our skills and striving for the highest standards in our respective fields, we not only achieve personal and organisational success but also contribute to the broader goal of uplifting South Africa 

South Africa’s Future Prospects: A Panel Discussion 

Moderated by award winning financial journalist, Fifi Peters, Investec’s Annabel Bishop, Momentum Investment’s Sanisha Packirisamy, and Nomvuyo Guma from the National Treasury gave their perspectives on the country’s economic outlook. 

Cautious optimism marked much of the discussion, with Guma stressing the potential of the Government of National Unity (GNU) in bringing new energy and continued commitment to initiatives such as Operation Vulindlela focussing on areas like water, electricity, logistics, digital infrastructure and visa reforms. While noting early signs of recovery, including an uptick in the Purchasing Managers’ Index (PMI) and business confidence, Bishop pointed out the challenges of managing South Africa’s mounting debt—now exceeding 70% of GDP—and highlighted the country’s struggling credit rating. 

The panellists agreed that while the GNU brought some political stability, much more needs to be done to secure investor confidence and foster long-term economic growth. Foreign Direct Investment (FDI) and the need for fiscal prudence were highlighted as essential to navigating South Africa’s financial future. 

The consensus was that while the government’s current efforts have laid the groundwork for improvement, it will take sustained commitment and implementation to fully capitalise on these reforms. The discussion also touched on South Africa’s grey listing by the Financial Action Task Force (FATF), where Packirisamy stressed the importance of addressing crime and corruption to restore international confidence. 

The impact of global politics, particularly the U.S. elections, was a significant topic. Bishop noted that the shifting political landscape in the US, marked by protectionist tendencies under Trump and a more centralist approach with Kamala Harris, could influence global trade dynamics and, consequently, South Africa’s economic environment. Packirisamy echoed these concerns, highlighting that while AGOA (African Growth and Opportunity Act) has been a valuable trade tool, its effectiveness is limited, as seen with low agricultural and automotive trade volumes. Additionally, both economists discussed the implications of global uncertainties, including the ongoing conflict in Ukraine and tensions in the Middle East, on South Africa’s economic stability and investment climate.  

They stressed the need for South Africa to navigate these international challenges carefully to bolster its economic resilience and attract foreign investment amidst a complex global backdrop. I am hopeful that the effective implementation of South Africa’s policies will pave the way for significant economic progress. 

Keynote Speeches on China and India: Emerging Market Shifts 

The final keynote speeches by Louis-Vincent Gave and Rajesh Sehgal explored the evolving roles of China and India in the global market. Gave addressed China’s economic slowdown and the pressure on asset owners as real estate values plummet. However, he highlighted China’s strategic moves in industrials, alternative energy and robotics, areas where the country is still seeing growth. He also pointed out that China’s trade surplus (c $70-100bn monthly) could allow it to redeploy capital into emerging markets, creating significant opportunities and ultimately supply chain expansion. 

Sehgal’s presentation on India emphasised the country’s rapid GDP growth, which is set to make it the third-largest $3 trillion economy by 2030 (after U.S. and China). India’s focus on digital transformation, infrastructure development, and manufacturing makes it a prime destination for investors looking to capitalise on a burgeoning middle class and robust economic reforms. 

The political landscapes in both countries were crucial points of focus. Gave addressed the broader geopolitical context, noting that China’s internal and external political challenges—such as its approach to the Taiwan issue and its strategic global supply chain investments—impact its economic relations with other countries, including South Africa.  

Meanwhile, Sehgal highlighted India’s political climate and its role in driving economic growth. India’s democratic processes and recent policy reforms, including changes in tax regulations and infrastructure development, are pivotal in shaping its economic trajectory. Sehgal pointed out that the Indian government’s focus on digital infrastructure and sustainable energy, coupled with its large, young working-age population, positions India as a growing economic powerhouse.  

Both discussions indicated that South Africa should consider these political dynamics as they navigate trade and investment opportunities in these emerging markets. 

Conclusion 

Navigating uncertainty in today’s financial landscape requires a strategic blend of innovation and addressing systemic challenges. As South Africa moves forward post-election, our success in implementing reforms and policies—such as those championed by Operation Vulindlela—will shape our economic trajectory. While the potential for transformation is immense, success depends on tackling long-standing inequalities, fostering private sector collaboration, and ensuring that new technologies, like AI, benefit society at large.  

The conference highlighted the need for South Africa to remain agile, drawing on global lessons from countries like China and India to enhance our economic strategies. Similarly, strategically engaging with these markets will be crucial for navigating uncertainties and achieving long-term growth. 

The above observations are based on my personal recollection of the talks presented at the conference. While every effort has been made to accurately reflect the views expressed by the speakers, any errors or misrepresentations are unintentional. 

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