South Africa wants the money its fund managers run abroad to be run from Johannesburg instead. On 21 October the South African Reserve Bank (SARB) published a draft framework for a synthetic financial centre, which it describes as a way to build a financial hub through legal, regulatory and tax arrangements that let transactions happen in South Africa even when the investors or assets are elsewhere.
What the first phase allows
- Approved institutions can manage qualifying foreign portfolios and related foreign currency activity from South Africa.
- Licensed asset managers, banks, insurers and private equity firms can run global portfolios in any currency through registered mandates, Sunday World reports.
- Foreign financial services firms may apply to the SARB's Financial Surveillance Department to take part.
- Comments on the draft exchange control circular close on 30 November 2026.
The 45% question
Inside a registered mandate, funds could be fully invested abroad, Sunday World reports. The 45% offshore limit still applies when a local institution commits its own capital to such a vehicle, and that investment still counts toward its own foreign limit. Olano Makhubela, head of the SARB's Financial Surveillance Department, said the 45% limit will remain a "long-term feature". About R5 trillion of South African portfolio assets is already held offshore, the paper notes.
"We developed the SFC because South Africa should be competing for this business, not watching it move elsewhere," said Valdene Reddy, chief executive of the JSE, which backs the plan through the private-sector Operation Phumelela, Business Day reports. A second phase could align tax rules and allow foreign-currency listings on South African exchanges, according to National Treasury's Vukile Davidson.
