(Bloomberg) -- Foreign investors are wading into South African government bonds while steering clear of equities, despite a stock-market surge that’s left emerging-market peers in its wake.

Non-residents have purchased a net 25.8 billion rand ($1.4 billion) in South African bonds this year, according to data from the Johannesburg Stock Exchange. By contrast, they’ve sold a net 127 billion rand of equities - heading for the ninth straight year of outflows.

That means they’ve missed out on a 20% rally in dollar terms for Johannesburg’s main index since mid-June, following elections that resulted in the formation of a coalition government. That compares with a gain of just 5.4% for the MSCI EM stock index in the same period.

UBS Asset Management — which views South Africa as one of the most promising emerging markets for economic growth — says the lower-risk returns of bonds are more attractive. Government local-currency debt has returned 19% since mid-June in dollar terms, compared with the emerging-market average of 4.1%, according to Bloomberg indexes.

The firm forecasts the country’s GDP will grow by 2.1% in 2025, driven by easing infrastructure constraints, a resilient consumer base, and improved investment, according to economist Gyorgy Kovacs. Meanwhile, inflation is slowing, improving the real returns on fixed-interest investments like bonds.

The equity market, on the other hand, faces external risks, including the threat of US tariffs and China’s economic woes. That may affect South African companies exposed to international markets, undermining the strong performance of the FTSE JSE Africa All Share Index, said Manik Narain, head of EM strategy research at UBS.

Adding to the uncertainty, UBS predicts that South Africa’s current account-deficit could exceed 2% of GDP next year. “If the deficit widens, it could put pressure on the rand, and the equity market may feel the pain,” Narain said.