Investing offshore - legal and prudent

Offshore investing offers some very real advantages to exporters, especially in the African context, according to Coreen van der Merwe, managing director of Sovereign Trust SA. “There are several benefits to offshore investing including the fact that it allows for better access to other emerging market economies,” she said. Speaking at the Western Cape Exporters Club (WCEC) last week, Van der Merwe said often South Africans did not consider offshore investing because they associated it with illegal practices, but this was far from the truth. “Not only is offshore investing perfectly legal – it is also advantageous as it is giving you access to investment in shares and markets that do not exist locally." At the same time, said Van der Merwe, offshore investment often resulted in tax minimisation as many of the investment destinations offered tax incentives to foreign investors while at the same time it was a good form of asset protection. “In Africa in particular this is important as many of the markets into which people are moving are still very unstable. Also one must remember that offshore investments can be paid out anywhere in the world and this is important as trading in the rand is controlled by the Reserve Bank.” She said already they were seeing more and more companies that were expanding their footprint into the African market were investing offshore. “It is a very affordable avenue and not reserved only for big companies with major funds available, and the procedures and requirements are relatively simple,” she explained. INSERT & CAPTION It is a very affordable avenue and not reserved only for big companies with major funds available. – Coreen van der Merwe