22 May 2019

South Africa: Corporate SA Pushes Into Poland's Land of Promise and Prosperity


Poland is quite the flirt. It has attracted a number of JSE listed companies to its shores over the years. And as long as the SA economy remains dim and exchange controls are kept intact, industry players say that their home country will continue to push its companies into the arms of foreign suitors. And Poland does hold promise. It has increased its GDP per capita by almost 150% since 1989, more than any other European country.

For SA companies, the push into Poland comes from the uncertainty surrounding the local economy. Analysts believe it is forcing local corporates to look abroad for diversification and risk hedging local risks and growth prospects. They argue that the attraction for SA capital ranges from anything between high yields to stable currencies as well as access to cheaper debt.

For JSE-listed real estate investment trusts, the Eastern European market has proved particularly prosperous. There are 61 companies listed on the JSE for a combined market cap of R770-billion. Significantly, up to 40% of this sector's assets are managed offshore. And half of that is in Eastern Europe.

"The reasons behind this are fairly simple. In some ways Poland and SA are very similar,"...

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