Irish investors should not panic about a proposal to ban foreigners from owning property in South Africa, the country's ambassador to Ireland said today.
Priscilla Jana was commenting after an advisory group to the South African government called for an immediate ban on foreigners buying land and property in the country. An estimated 16,000 Irish people live in South Africa.
There is considerable backing in South Africa for a ban by those claiming that locals cannot afford homes because foreigners are inflating the market.
However, the main opposition party, the Democratic Alliance, said a ban on foreign ownership would have "profound negative economic consequences".
Its agriculture spokesman, Kraai van Niekerk, cited a recent €50 million investment by Irish firm Howard Holdings in Cape Town, which is described as the largest private sector, inner city renewal project in the city's history.
South African President Thabo Mbeki has already committed to regulating the sale of land and property to foreigners and has promised to carry out an audit.
But an advisory group to Agriculture Minister Thoko Didiza on Friday advised a moratorium on foreign ownership "with immediate effect as an interim measure until appropriate legislation has been promulgated".
But Ms Jana told ireland.comtoday that despite the expert group's advisory, there were no changes imminent. She said investors and those who already own real estate in the country have "no need to panic".
She said: "This is only a progress report by an independent commission - it's not policy. Whatever we do with this will be in accordance with international norms and standards and will not affect the rights of foreign investors."
The South African economy was heavily dependent on foreign investment and that policy was not going to change, she added.
Pretoria is committed to transferring 30 per cent of commercial farmland to blacks by 2014 as part of land reform measures.
But the largest real estate firm in South Africa said it was "fallacious" to associate foreign ownership with the issue.
Andrew Golding, chief executive of Pam Golding Properties, told ireland.com: "Foreigners make up an insignificant section of the market - about 1 per cent. The message being put out [by the expert group] is causing concern in the market, but we will have to wait and see what happens."
Property prices have risen by around 200 per cent in South Africa since 1997, but some analysts say strong economic growth and the burgeoning black middle class is driving the market.