Thesis (M.Com. (Economics)) -- University of Limpopo, 2022 / The primary goal of this study was to investigate the effects of budget deficit on fixed investment using annual data for the period 1990-2017 in selected African countries namely, Cameroon, Namibia, Ghana, Egypt, Seychelles, Mauritius, Botswana, Lesotho and South Africa. The study employed panel unit root tests including the Augmented Dickey-Fuller test, Philips Perron test and Levin Lin and chu test. The tests revealed that all the variables are integrated at 1st difference. The study further employed the Panel ARDL bounds test to examine the relationship between budget deficit, fixed investment, money supply and inflation. The empirical findings indicated that a long run relationship exists between the variables of interest. Furthermore, the results revealed that the budget deficit has a negative and statistically significant effect on fixed investment. A one percent increase in the budget deficit, ceteris paribus, leads to a reduction in fixed investment by 44 percent in the long run. The findings further postulated a bidirectional causal relationship between budget deficit and fixed investment, between money supply and fixed investment and between fixed investment and inflation. It was evident in the research that indeed the budget deficit is a problematic macroeconomic policy in African countries. Policy makers should limit high government expenditures as they contribute to increased and persistent budget deficits which crowd out private investment.

Thesis (M. Com. (Economics)) -- University of Limpopo, 2021 / Investment as one of the main macroeconomic variables can ensure development of infrastructure and economic growth through increasing productivity and attracting investors. This study examined key determinants of investment activities by means of a comparative analysis between the SADC and BRICS groups during the period 2004- 2019. The key variables were the real exchange rate, real interest rate and trade openness. The analysis began by reporting unit roots tests, which paved way for employing Panel Autoregressive Distributive Lag (PARDL) methodology in the existence of different orders of integration. To estimate the long run relationship between the variables, we made use of the panel Johansen cointegration test, Pedroni test, Kao test and the Johansen Fisher cointegration test. Through the PARDL, the exchange rate and trade openness were found to be positive and statistically significant determinants of investment in SADC although statistically insignificant in the BRICS group. In addition, interest rates yielded insignificant results in the SADC region while, on the contrary, yielded a negative and statistically significant relationship in the BRICS group. The Granger causality test indicated a bi-directional causality in the exchange rate-investment and trade openness investment nexus for the SADC group while there was no causality in the BRICS group. It can be concluded that trade openness and exchange rate are key determinants of investment in the SADC region while interest rates are key in the BRICS group. It is therefore recommended that in order to attract investors and boost investment activities the SADC group need to focus more on exchange rate stability and trade openness while the BRICS group need to pay more attention to the flexibility of interest rates. This is beneficial on trading patterns, more for South Africa as it can be found in both groups.

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