South Africa has fallen back in a ranking among emerging economies on its attractiveness to investors, partly due to a downturn in mining output late last year, according to a global index published on Thursday.
The country slipped five places to 12 among 25 countries in the emerging market component of the 2026 edition of the foreign direct investment confidence index, an annual survey of global business executives conducted by management consultancy firm Kearney’s global business policy council.
The survey ranks countries most likely to attract foreign direct investment (FDI) over the next three years.
The 2026 survey reflects a global investment environment shaped by intensifying geopolitical tensions, expanding industrial policy and accelerating technological competition, Kearney said.
The report says that as investors overwhelmingly cite South Africa’s natural resources as the strongest reason to invest in the country, they were likely to have been concerned when the mining sector experienced its first production decline in nine months in November.
Mining output fell 2.7% year on year during that month as logistical constraints weighed on local coal and iron ore companies, according to Stats SA.
“Indeed, domestic political uncertainty, infrastructure issues, increasing operational costs and global trade tensions have all converged to impact demand for South African minerals exports,” Kearney said in its report on Thursday.
Respondents in its survey were asked to identify the strongest reasons for investing in each emerging market economy.
South Africa’s highest score was 36% for its natural resources, while its tech innovation only mustered 19%, and respondents gave the country 22% each for ease of doing business as well as transparent governance and lack of corruption.
It scored 23% on the talent and skill of its labour pool, 24% on economic performance and managed just 25% on the quality of its infrastructure.
The report comes days after economists poured cold water on President Cyril Ramaphosa’s announcement that hundreds of billions of rand had been pledged at a recent annual investment conference.
While the conference announced 81 investment pledges from as many companies — totalling R415bn from 22 source markets — analysts said this figure fails to align with official data on gross fixed capital formation as a percentage of GDP.
The presidency says the event has attracted R1.14-trillion worth of investment commitments in mining, manufacturing, agriculture, energy and the digital economy since the first investment conference in 2018.
However, according to Stats SA, gross fixed capital formation declined by 1.4% in the fourth quarter of 2019. It said gross fixed capital formation increased 1.3% in the fourth quarter of 2025, contributing 0.2 percentage points to total growth.
The recent escalation of conflict in the Middle East adds a layer of uncertainty to the global investment environment, with the potential to disrupt, delay, or redirect FDI flows depending on how risks evolve, the report says.
“Investors still believe in the value of FDI, but they are recalibrating how they make their decisions in a more turbulent operating environment,” said Erik R Peterson, partner and managing director of Kearney’s Global Business Policy Council and co-author of the report.
“Capital continues to flow, but companies are becoming more selective about where they invest as they weigh technological capabilities, geopolitical risks and the growing influence of industrial policy.”
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