Unfortunately our export performance has not kept up with imports, despite the significant increase in commodity prices. Over the past few years, when the economy was growing at rates above 5 per cent, the bulk of net capital inflows were into the equity markets. The sustainability of these flows is, however, not only dependent on domestic developments.
In the final quarter of 2007 we experienced significant net sales of bonds and equities by non-residents as a result of global risk aversion in response to the turmoil in global credit markets. These sales intensified in January and February as electricity supply constraints contributed to negative perceptions of our growth prospects.