SA not a place you can bank on

For some time now I have been wary about the health of the South African economy and have tailored client portfolios accordingly, leaning towards businesses listed on the JSE that function internationally, concentrating their operations mainly in a number of fast-expanding developing regions.

These include British American Tobacco, Richemont and SABMiller. Also, where possible I have encouraged clients to move money abroad and invest their funds in a portfolio of well diversified foreign stocks with attractive earnings and dividend prospects that trade at relatively cheaper multiples than counters on our domestic market.

Since the beginning of the year the strategy has paid handsomely. In dollar terms, the JSE is down about 5%, while US markets, for example, are up 22%.

But though it is easy to implement a course of action that could protect your finances against a whole succession of political, corporate, social and economic risks afflicting our future prosperity, it is much more difficult to find a plan that would preserve your lifestyle and guard your family against adversity in South Africa.

Last Sunday, athletics legend Sonja Laxton was heading home from an early-morning training run. A speeding car hit her, sending her flying through the air. The driver made no apparent attempt to slow down or take evasive action and, worst of all, carried on driving as if nothing had happened. Laxton suffered serious fractures to her shoulders, arms, ribs and left ankle. Her condition is serious and she is likely to remain in hospital for weeks.

South African roads are among the most dangerous in the world - the upshot of absent policing, poor instruction and a crumbling infrastructure. In Johannesburg, the road system is fast disintegrating. Apart from treacherous potholes, the vast number of inoperative traffic lights on main arteries, complicated by a lack of pointsmen, is causing maddening logjams that unhinge driver rage and promote recklessness.

Yet the irresponsibility of the driver who struck Laxton was not the consequence of a faulty traffic light, but the mark of a persistent decline in the observation of law and order. If the risk of being caught is lower than it should be, the risk of misconduct shoots up.

Developers unlawfully build shopping malls that collapse; criminals brazenly hijack vehicles in peak-hour traffic, while high-ranking ministers shamelessly thwart investigations into the alleged misuse of taxpayers' funds.

Misconduct is not confined to the developing world.

In Greece, the cradle of modern civilisation, it was the doctors, lawyers and other intelligentsia who contributed to the treasury's ruin by swindling the taxman.

And have you ever noticed how, in the aftermath of a flood, earthquake or other tragic upheaval, folk in generally law-abiding countries flagrantly plunder unprotected stores. I bet even in a nanny city like Sydney, the residents would park all over the place if the police went on strike for a few days. Still, in South Africa, we seem intent on taking our delinquency to anarchic levels.

An old client of mine always jokes that a man and his money should never reside in the same country. I've never taken him seriously, until now. The government's failure to get a grip on crime and corruption and its commitment to transformation over job creation has left me concerned about the nation's wellbeing.

South Africa has an abundance of opportunity. It is blessed with astonishing natural beauty, a developed (if somewhat decaying) infrastructure, a vibrant private sector, a first-world financial system, a friendly and eager population and neverending sunshine. But if you can't offer your people security in their homes and safety on the roads, all that promise is worthless. The young will depart with their skills, the elderly with their wealth.