​The international investment position (IIP) of a country is a point-in-time statement of the value3 of the residents’ financial claims on non-residents (outward investment) and liabilities to non-residents (inward investment). The stock positions, or outstanding balances, of both South Africa’s foreign financial assets and foreign liabilities relative to gross domestic product (GDP) increased significantly after 1994, as cross-border financial activity increased notably following the removal of trade and financial sanctions against South Africa. The net IIP is the difference between foreign financial assets and foreign liabilities, which could either be a net claim (creditor) on or a net liability (debtor) to the rest of the world.The year 2015 marked South Africa’s first positive net IIP since the inception of this statistic in 1956. The switch to a net positive asset position was brought about by the decline, on balance, of 19.7% in the nominal effective exchange rate (NEER) of the rand in 2015, together with holding (valuation) gains in South Africa’s foreign financial assets due to price increases abroad. Subsequently, the net IIP narrowed in 2016, partly as a result of a strengthening in the exchange value of the rand. Changes in the exchange value of the rand have a larger effect on foreign financial assets, as they are more exposed to foreign currency-denominated financial instruments than foreign liabilities. This is brought about by rand-denominated equity liabilities and a near-equal split between foreign and domestic currency-denominated debt liabilities. The value of domestic currency-denominated debt liabilities is largely due to significant non-resident holdings of South African government bonds.