SOUTH African chief financial officers are much more concerned about general political instability resulting from the economic crisis than their international peers, with 76% expressing concern, compared with 49% of their international counterparts.

The annual BDO ambition survey asked chief financial officers their views on growth prospects and where they saw areas for expansion outside their own borders, and the challenges facing investments in those markets.

Financial officers from 14 countries, including France, Germany, Japan, the UK and the US, redrew the map of risk hotspots. Parts of Europe are seen to be as risky as the politically unstable countries of the Middle East.

According to the survey, Spain was perceived as a riskier investment destination than Egypt and Greece was more risky than Libya and Syria.

When asked to "spontaneously" identify which countries would be a focus for expansion, 6% of the 1,050 participants chose South Africa. The survey was conducted between May and July this year, well before the Marikana mine tragedy on August 16 that left 34 miners dead.

The survey targeted specific sectors such as natural resources, manufacturing, and property and construction.

Chief financial officers in India and Australia indicated they were most likely to look at expansion into South Africa. The factors driving South Africa’s appeal were access to new customers (42%), attractive profit margins (39%) and market size (33%).

The risks included finding the right local management and staff to do the job (44%), corruption and ethics (39%) and currency fluctuations (33%).

BDO’s CEO, John Spencer, said chief financial officers around the world were finding it more difficult to conduct business abroad. "This year currency fluctuations and geopolitical risks have replaced red tape and bureaucracy as the top threats to successful foreign expansion."

South African chief financial officers were the most courageous, with 90% planning to expand internationally in the next year, compared with the average of 72% of the international participants considering expansion.

The participants in the survey were chief financial officers from medium-sized companies with revenues between $50m and $2bn.

"Our survey shows that the risk-reward dynamic is changing as ambitious chief financial officers face greater risk for the same reward. Chief financial officers from mid-sized companies are having to stick to what they know in their approach to overseas investment, rather than take bigger risks that could lead to greater returns," Mr Spencer said in a statement issued on Monday morning.

The mood of chief financial officers was also much more subdued than a year ago, when 49% said they were very optimistic about their expansion plans. This year only 24% felt optimistic about their plans.