Bibliography: leaves 305-324. / The thesis examines the theory of the determinants and welfare impact of foreign direct investment on host countries, concluding that resource transfer effects are not necessarily beneficial in certain circumstances. The distribution and penetration of foreign direct investment in the South African economy is analysed in the context of the debate about dependency and the role of technology in economic development. It is concluded that given the small amounts of fixed capital actually transferred to South Africa and the negative basic transfer which has occurred since the war, the role of technology in the economic development of South Africa has been crucial. It is argued that despite the relatively low level of foreign direct investment penetration in south Africa, efforts to reduce this penetration are hampered by continuing high dependence on foreign technology, which reflects the ~ay in which the international technology market works. The conclusion is that this dependence can only be reduced by assimilating and copying foreign technology, which should, if necessary, be purchased separately from capital, especially if foreign investors are reluctant to risk fixed investment in the New South Africa. The statistical sources used are official South African Reserve Bank figures for capital flows and stocks, a data base constructed by the author from the Bureau of Market Research's unpublished industrial register and the results of a questionnaire administered to a stratified random sample of local and foreign manufacturing firms in South Africa.

A Dissertation Submitted to the Faculty of Commerce University of the Witwatersrand for the Degree of Master of Commerce / The purpose of this paper is to provide a critical assessment of the Foreign Direct Investment (FDI) policy stance in South Africa. We analyse whether investment incentives will be effective in increasing FOI inflows and look at the importance of the behaviour of transnational corporations (TNCs) in determining the impact of FDI on the host. This analysis allows us to determine the appropriate objective of FDI policy, namely channelling TNC behaviour' such that they generate the desired benefits for the host-This raises the question of how such behaviour may be channelled in practice. Using the framework of information economics, we identify the nature of the difficulties with which policy makers must deal in designing behavioural incentives. Although this does not lead us directly to policy prescriptions, when augmented with practical considerations, it provides us with a basis for analysing whether FDI policy (as distinct from industrial policy) is called for by isolating one instance in which a differentiated approach. would be likely to increase the efficacy of policy, we show that there is good reason to suspect that the absence of a distinct FDI policy in South Africa may be suboptimal. / AC2017

Thesis (D. Admin.(Public administration))-University of Pretoria, 2005. / Abstract in English. Includes bibliographical references. Available on the Internet via the World Wide Web.

Assignment (MComm)--University of Stellenbosch, 2003. / ENGLISH ABSTRACT: The offshore investment industry has shown tremendous growth (R92,7 billion invested in offshore unit trusts and mutual funds) since the Minister of Finance took the bold step (1 July 1997) availing South African (SA) residents the opportunity to invest offshore. Currently, SA residents, subject to certain criteria, are allowed to invest R750 000 offshore. The primary objective of this assignment is to provide a general overview of offshore investments from a SA resident's perspective. Foreign investment policies as they relate to local residents are reviewed. Investment maxims, truisms and theory are introduced to provide a theoretical framework to accommodate future chapters. The question regarding why South Africans should invest offshore is answered by firstly identifying specific risks that are unique to this country, its people and businesses and, secondly, by looking at market risk. Conclusive empirical evidence states that offshore diversification reduces portfolio risks and enhances returns. Offshore investments, their related costs/fees, investment strategies as well as regulations that offshore investors must adhere to, are also discussed. The most important obstacles to investing offshore, namely the home bias phenomenon and currency or exchange rate risk, are placed in perspective. Important tax implications for investing offshore are also briefly mentioned. In the final chapter conclusions and recommendations are made. / AFRIKAANSE OPSOMMING: Die buitelandse beleggingsindustrie het merkwaardig gegroei (R92,7 biljoen is tans in buitelandse effektetrusts en onderlinge fondse belê) sedert die Minister van Finansies die dapper stap geneem het (1 Julie 1997) om Suid-Afrikaanse (SA) burgers die geleentheid te bied om in die buiteland te kan belê. Huidiglik kan SA burgers, onderworpe aan sekere kriteria, tot R750 000 in die buiteland belê. Die primêre doelwit van hierdie werkstuk is om 'n oorsig vanuit die SA burger se perspektief voor te lê. Buitelandse beleggingsbeleide, asook hoe hulle SA burgers beïnvloed is in oënskou geneem. Beleggingsgrondstellings, -waarhede en - teorieë, is bespreek om 'n teoretiese agtergrond te verskaf vir latere hoofstukke. Die vraag waarom Suid-Afrikaners in die buiteland moet belê, word beantwoord deur eerstens, spesifieke risiko's wat uniek is aan ons land, sy mense en besighede, te identifiseer, en tweedens, om na markrisiko's te kyk. Konklusiewe empiriese navorsing bewys dat buitelandse beleggings die risiko's van portefeuljes verlaag en opbrengste verhoog. Buitelandse beleggings, hul verwante koste/fooie, beleggingstrategieë, asook regulasies waaraan buitelandse beleggings moet voldoen, is bespreek. Die belangrikste struikelblokke vir belegging in die buiteland, bekend as die sogenaamde "home bias"-verskynsel en val uta- of wisselkoersrisiko's, is in perspektief gestel. Belangrike belastingsimplikasies vir buitelandse beleggings word ook kortliks genoem. In die finale hoofstuk word gevolgtrekkings en aanbevelings gemaak.

Thesis (M.M. (Finance & Investment)--University of the Witwatersrand, Faculty of Commerce, Law and Management, Wits Business School, 2017 / This study investigates the effects of M&A to investment returns in South Africa. The value of M&A executed in emerging economies (EM) is around $129 billion (The United Nations Conference on Trade and Development (UNCTAD), 2014) and this figure is projected to double in the next ten years bringing positive economic development in EM. In light of this perspective, there is renewed interest in understanding the economics of M&A in developing countries. Our aim was to assess the extent of mergers and acquisition on shareholder returns in South Africa using a case study approach. A case study approach was adopted in order to analyse the impact of specific events on shareholder value by date. Two prominent mergers involving acquiring companies from Developed Markets (DM) were selected namely AB Inbev (Belgium) and Walmart (US). As anticipated, the results show that each merger update announcement had an impact on the share price of the target based on the type of announcement. Positive news increased the share price and bad news adversely impacted the share price. Post the merger, Massmart’s headcount increased and profitability decreased. The same could not be measured for SABMiller as the company has been delisted. / MT2017

Thesis (MBA)--Stellenbosch University, 2005. / ENGLISH ABSTRACT: Foreign direct investment is generally welcomed and sought after by developing countries such as South Africa and seen as an important vehicle to raise capital and promote growth. This h as also been recognised by the South A frican government that indicated that foreign direct investment (FDI) has been identified as a requirement in their fight against poverty and to fuel development. South Africa, unfortunately has not been able to attract significant and sustainable amounts of FDI and has been identified by Unctad World Investment Report (2004: 14) as a country that is performing under its potential in attracting FDI. Other countries in Africa like Nigeria seem to be able to consistently attract more FDI while they are less competitive and politically less stable than South Africa. This study seeks to explore the reasons for this disparity in FDI flows with special reference toN igeria a nd South Africa, to assess t he difference inc ompetitiveness between the two countries, to asses the impact of this on FDI flows and to analyse and compare the reasons for FDI in South Africa and Nigeria utilising certain Unctad and WAIPA criteria. The conclusion is that multinational companies are profit seeking and that they will take on considerable risk (such as political instability for example) if the returns are high enough. Nigeria is attracting mostly resource-seeking FDI to its rich oil sector through multinational oil companies that have the technology and capability to extract the oil economically. This is happening regardless of the fact that the country's infrastructure and institutions are weak, widespread violence and political instability is at the order of the day, Nigeria has a small economy (and hence a small market) and is plagued by high levels of corruption. South Africa in contrast, while also having natural resources has attracted mainly market-seeking FDI. The South African markets however are not particularly big when compared to other first world countries and these FDI flows are not sustainable. South Africa would need to concentrate on becoming more efficient if it wants to attract more FDI but will be competing with other countries like Malaysia, India and Eastern Europe in the process that proves to be a challenge currently. / AFRIKAANSE OPSOMMING: Ontwikkelende lande soos Suid-Afrika verwelkom en soek oor die algemeen direkte buitelandse belegging en dit word beskou as 'n belangrike manier om kapitaal te bekom en groei te bevorder. Hierdie beskouing word ook gehandhaaf deur die Suid- Afrikaanse regering wat aangedui het dat direkte buitelandse belegging identifiseer is as 'n vereiste vir die stryd teen armoede en om ontwikkeling te bevorder. Ongelukkig het Suid-Afrika nog nie daarin geslaag om beduidende en standhoudende hoeveelhede direkte buitelandse belegging te lok nie en is deur die Unctad World Investment Report (2004:14) identifiseer as 'n land wat onderpresteer met betrekking tot sy vermoë om direkte buitelandse belegging te lok. Ander lande in Afrika, soos Nigerië, blyk in staat te wees om deurlopend meer direkte buitelandse belegging te lok, terwyl hulle minder kompeterend en polities minder stabiel is as Suid-Afrika. Die doel van hierdie studie is om die redes vir hierdie ongelykheid in die vloei van direkte buitelandse belegging te ondersoek met spesifieke verwysing na Nigerië en Suid-Afrika, om die verskille in kompeterendheid tussen die twee lande te oorweeg, om die impak hiervan op die vloei van direkte buitelandse belegging te ondersoek en om die redes vir direkte buitelandse belegging in Suid-Afrika en Nigerië te analiseer en te vergelyk met behulp van sekere van die Unctad en WAIPA kriteria. Die slotsom is dat multinasionale maatskappye winste najaag en dat hulle aansienlike risiko's sal neem (bv. politiese onstabiliteit), as die opbrengste hoog genoeg is. Nigerië lok meestal hulpbron-gedrewe direkte buitelandse belegging na sy ryk oliesektor deur internasionale oliemaatskappye wat beskik oor die tegnologie en kapasiteit om die olie ekonomies te ontgin. Dit gebeur ongeag die feit dat die land se infrastruktuur en organisasies swak is, wydverspreide geweld voorkom, politieke onstabiliteit aan die orde van die dag is, Nigerië 'n klein ekonomie (en dus 'n klein mark) het en geteister word deur hoë vlakke van korrupsie. In teenstelling hiermee het Suid-Afrika, wat ook oor natuurlike hulpbronne beskik, hoofsaaklik mark-gedrewe direkte buitelandse belegging gelok. Die Suid-Afrikaanse markte is egter nie eintlik groot nie as dit vergelyk word met ander eerstewêreldlande nie en hierdie vloei van direkte buitelandse belegging is nie volhoubaar nie. Suid-Afrika sal daarop moet konsentreer om meer effektief te word as hy meer direkte buitelandse belegging wil lok, maar sal moet meeding met ander lande soos Maleisië, Indië en Oos-Europa in 'n proses wat tans 'n uitdaging blyk te wees.

Thesis (MBA)--Stellenbosch University, 2005. / ENGLISH ABSTRACT: Please refer to fulltext for abstract / AFRIKAANSE OPSOMMING: Buitelandse Direkte Investering (BDI) kan 'n beduidende rol in die ontwikkelingsproses van 'n land speel. Vir hierdie rede is gasheerlande begerig om investering te lok en wel vir die voordele wat dit bring. Meeste ontwikkelende lande promoveer hulleself vir hierdie doel. Voorbeelde hiervan is die liberalisering van wetgewing en regulasies om dit vir BDI aantreklik te maak soos die verskaffing van waarborge oor die repatriasie van winste en die skep van meganismes vir die beslegting van investeringsgeskille. Dit lei egter nie outomaties tot verhoogde investering nie. Oor die afgelope 10 jaar het die VN se Konferensie vir Handel en Ontwikkeling (VNKHO) byvoorbeeld bevind dat Suid-Afrika se beleggingspotensiaal nie ten volle benut word nie. Die doel van hierdie studie is om uit te vind wat die redes hiervoor is. Oënskynlik beskik Suid-Afrika oor alle vereistes: 'n stabiele ekonomie en politieke sisteem en 'n goeie beleggingsklimaat. Ten einde die probleem beter te verstaan, is 'n vergelykende BDI studie met Maleisië onderneem wat veel meer suksesvol was. 'n Vergelykende metodologie is ontwerp wat gebaseer is op kriteria van die VNKHO se World Investment Reports en die World Association of Investment Promotion Agency (WAIPA). Beleide, vergelykende mededingendheid, handelsooreenkomste en belastingaansporings is ook by die vergelykings ingesluit. Dit is spesifiek gedoen omdat die kwessie van belastingaansporings 'n kontroversiële saak is. Lok dit regtig beleggings? Is daar dalk ander kostes hieraan verbonde? Die vergelykende metodologie het nuttige insigte opgelewer, ook hoekom BDI nie altyd plaasvind nie. Daar is vier faktore wat Suid-Afrika benadeel: arbeidshulpbronne, beperkte plaaslike en streeksmarkte in Afrika, politieke en ekonomiese onsekerheid, en yslike maatskaplike probleme met armoede en vigs. Daar mag egter ook ander faktore wees waarom spesifieke transnasionale korporasies nie belê nie. Dit is bevind dat die SA regering méér kan doen om aktiewe BDI te bevorder, selfs met gerigte aansporings. Dit is van die grootste verskille met Maleisië. Hierdie studie het ook bevind dat vergelykende metodologieë meer kan doen om van groot maatskappye te verneem waarom beleggingsbesluit geneem, of nie geneem word nie. Die volgende drie leemtes kan ook uitgewys word: wat is die spesifieke impak wat BDI op die Suid-Afrikaanse ekonomie het? Dis onseker. Wat beplan die regering ten opsigte van BDI strategieë en aansporings? Geen nuwe beleide is die afgelope jare geformuleer nie. Laastens, behoort soortgelyke tersaaklike inligting in aanbevelings bevat te word wat Suid-Afrika se BDI prestasie verhoog.

Thesis (MBA)--Stellenbosch University, 2002. / ENGLISH ABSTRACT: The relationship between competitiveness and FDI inflow was investigated in this study. South Africa needs FDI to stimulate the economy with the ultimate goal of reducing unemployment and improving the quality of life of the population. Substantial FDI inflow was expected after the peaceful transition to a multi-party democracy in 1994. The data of the IMD World Competitiveness Yearbook (WCY) was used to measure competitiveness. The UN Human Development Index was used to determine the progress of human development. The annual World Investment Report published by UNCTAD was used to determine a framework of the determinants for FDI. The determinant framework as proposed by UNCTAD was used to evaluate the extent and importance of each determinant for FDI. This included the FDI policy framework, business facilitation measures and economic determinants (Market seeking, Resource seeking and Efficiency seeking). The competitiveness of South Africa was evaluated using the IMD WCY measurement. The IMD ranking of South Africa declined after 1994 and then stabilised. The trend of the UN HDI was detailed and the negative effect of HIV/AIDS on life expectancy could clearly be identified. The examination of the FDI inflow to South Africa during the period 1994 to 2000 showed that it did not reach anticipated levels. No correlation between competitiveness and FDI inflow could be found for South Africa. Brazil was selected as a benchmark for South Africa due to its similar social, political and economical structure. Brazil succeeded in attracting substantial FDI inflows after 1994 when its economy was stabilised. Brazil's ranking in the IMD WCY improved during the period from 1994 to 2000. The UN HDI rating for Brazil has improved throughout the past 25 years. HIV/AIDS has no effect on the forecasted national life expectancy figures due to the low infection rate in Brazil. A strong correlation between competitiveness and FDI inflow was found for Brazil. As the competitiveness ranking improved, the FDI inflow into Brazil increased and Vice versa. South Africa and Brazil were compared according to the relative strength of determinants to attract FDI, the strength of each competitiveness indicator and overall competitiveness ranking. South Africa compared very well with Brazil in terms of the FDI policy framework as well as the FDI business facilitation measures. In terms of efficiency seeking FDI, South Africa exceeded Brazil in the strength of its productivity and physical infrastructure, although Brazil was superior in skill level and scientific knowledge of the population. Resource seeking determinants are not strong in both countries. Brazil has an advantage over South Africa in that its population of 160 million is attractive for market seeking FDI. When the FDI inflow per capita was compared between South Africa and Brazil, the poor performance of South Africa was evident. Brazil also outperformed South Africa in terms of the IMD World Competitiveness Yearbook ranking. The IMD uses empirical data as well as data collected through surveys of business people in the ranking process. The survey data capture the perceptions of a country held by potential investors. Often perceptions override empirical data during the investment decision. The reason for South Africa's poor FDI inflow performance during the period 1994 to 2000 is difficult to resolve. The benchmarking with Brazil showed that the strength of the determinants (excluding market seeking) was on par with Brazil. The conclusion was made that the importance of various FDI determinants varies between regions of the world. Investment decisions involving Africa are made differently than in for example South America. UNCTAD data showed that resource seeking (oil & petroleum) FDI determinants with a high reward ratio was the only reaIly strong attraction for investment in Africa. The negative perceptions of Africa including civil unrest, famine and economic instability continue to influence the FDI inflow to South Africa. Although efficiency seeking together with a FDI policy framework and business facilitation measures attract FDI to a country in South America (Brazil), it is not sufficient to attract FDI to a country in southern Africa (South Africa). South Africa must change the international perceptions of the continent by creating a positive investment climate throughout Africa through strong, responsible leadership. The government must expand the knowledge and skill level of the population beyond basic education to enable them to participate in the international information and technology marketplace. Huge investments are required to create a culture of learning and self improvement in the population of South Africa. A high level of skills and knowledge will attract efficiency seeking FDI. / AFRIKAANSE OPSOMMING: Die doelwit van hierdie studie is om die verhouding tussen die internationale mededingendheid van 'n land en direkte buitelandse investering in die land te ondersoek. Suid-Afrika benodig direkte buitelandse investering om die ekonomie te stimuleer met die doel om werkloosheid te verminder en die lewenstandaard van die bevolking te verhoog. Na die demokratiese verkiesing van 1994 en die vreedsame oorgang tot 'n veelparty regering was daar groot verwagtinge van substansiële buitelandse investering. Die data van die IMD se World Competitiveness Yearbook (WCY) is gebruik om mededingendheid te evalueer. Die Verenigde Nasies se Human Development Index (HDI) is gebruik om die vordering van menslike ontwikkeling te bepaal. Die World Investment Report (WIR) van UNCTAD se raamwerk van determinante vir direkte buitelandse investering is gebruik om die omvang en belangrikheid van elke determinant te bepaal. Die UNCTAD raamwerk sluit die buitelandse investeringsbeleid, die besigheidsfasiliteringsmaatstawwe en ekonomiese determinante (markgedrewe, natuurlike brongedrewe en effektiwiteitgedrewe ) in. Die mededingendheid van Suid-Afrika is geëvalueer op grond van die IMD WCY proses. Die Suid-Afrikaanse posisie op die IMD ranglys het na 1994 verswak, maar daarna gestabiliseer. Die negatiewe effek van MIV/VIGS op die lewensverwagting van die bevolking is duidelik sigbaar in die tendens van die Verenigde Nasies se HDI vir Suid-Afrika. Die direkte buitelandse investeringsinvloei (1994 - 2000) na Suid-Afrika het nie aan die verwagtinge voldoen nie. Daar kon geen korrelasie tussen mededingendheid en buitelandse investering vir Suid-Afrika gevind word nie. Brasilië is geselekteer as 'n maatstaf vir Suid-Afrika as gevolg van die sosiale, politieke en ekonomiese oorenkomste tussen die lande. Brasilië het daarin geslaag om grootskaalse buitelandse investering te lok nadat sy ekonomie in 1994 gestabiliseer het. Brasilië se posisie op die IMD ranglys het gedurende die periode 1994 tot 2000 verbeter. Die Verenigde Nasies se HDI syfer vir Brasilië het verbeter gedurende die afgelope 25 jaar. Aangesien die MIV/VIGS besmettingsyfer baie laag is in Brasilië, het dit geen effek op die lewensverwaging van die bevolking nie. 'n Sterk korrelasie is gevind tussen mededingendheid en buitelandse investeringsinvloei na Brasilië. Soos Brasilië se posisie op die IMD se mededingendheidsranglys verbeter het, het buitelandse investering terselftertyd toegeneem en vice versa. Suid-Afrika en Brasilië is vergelyk in terme van die relatiewe sterktes van die determinante om buitelandse investering te trek, die sterkte van elke mededingendheidsindikator en algehele posisie op die IMD se mededingendheidsranglys. Suid-Afrika het baie goed vergelyk met Brasilië in terme van die direkte buitelandse investeringsbeleidsraamwerk asook die besigheidsinvestering en fasiliteringsmaatstawwe. In terme van effektiwiteitsgedrewe direkte buitelandse investering, het Suid-Afrika vir Brasilië geklop op die vlak van werkerproduktiwiteit asook die beskikbare infrastruktuur. Determinante vir natuurlike hulpbrongedrewe direkte buitelandse investering is nie sterk in enige van die twee lande nie. Brasilië het die verdere voordeel dat sy bevolking van 160 miljoen markgedrewe direkte buitelandse investering lok. Die vergelyking van direkte buitelandse investering për kapita tussen Suid-Afrika en Brasilië het getoon dat Suid-Afrika in hierdie opsig swak gevaar het. Brasilië het ook beter gevaar in terme van die IMD se mededingendheids ranglys. Die IMD gebruik empiriese data sowel as data van meningsopnames van sakeleiers. Die meningsopname data weerspieël die persepsie van sakeleiers oor 'n land. Dikwels kan persepsies deurslaggewend wees tydens die keuse van 'n belegging. Die rede vir Suid-Afrika se lae buitelandse beleggingsinvloei tydens 1994 tot 2000 is moeilik om te bepaal. Die vergelyking van Suid-Afrika met Brasilië het getoon dat die meederheid determinate van Suid-Afrika op standaard is. Die gevolgtrekking is gemaak dat die belangrikheid van determinante vir buitelandse investering tussen lande verskil. Beleggingsbesluite vir Afrika word anders gemaak as byvoorbeeld in Suid- Amerika. UNCTAD toon aan dat natuurlike hulpbroninvestering (olie en petroleum) met 'n hoë winsverhouding, die enigste sterk determinant vir belegging in Afrika is. Die negatiewe persepsies oor Afrika (onluste, hongersnood en ekonomiese onstabiliteit) beïnvloed steeds die invloei van buitelandse belegging na Suid-Afrika. Alhoewel doeltreffenheidsgedrewe buitelandse investering saam met 'n investeringsbeleidsraamwerk en besigheidsfasiliteringsmaatstawwe voldoende is om buitelande beleggings te lok na 'n land in Suid-Amerika (Brasilië), is dit nie die geval vir 'n land in Suider-Afrika (Suid-Afrika) nie. Suid-Afrika moet die internasionale beeld van die Afrika kontinent verander deur 'n positiewe beleggingsklimaat dwarsdeur Afrika te skep. Dit kan bewerkstellig word deur sterk, verantwoordelike leierskap in Afrika deur Suid-Afrika. Omdat basiese opleiding onvoldoende is, moet die regering die kennis en vlak van vaardighede van die bevolking uitbrei. Dit sal die bevolking in staat stel om deel te neem aan die internasionale mark vir informasie en tegnologie. Groot beleggings is nodig om 'n kultuur van kundigheid en selfverbetering onder die bevolking van Suid-Afrika te vestig. 'n Hoë vlak van vaardighede en kennis sal doeltreffendheidsgedrewe buitelandse investering na Suid-Afrika lok.

Thesis (MDF)--Stellenbosch University, 2015. / ENGLISH ABSTRACT: The traction of Foreign Direct Investment (FDI) has been viewed as a viable strategy for growing the economy and for solving such challenges as unemployment, the acquire skills and technology transfer. Many developing economies have implemented a number of macro-economic policies with the aim of boosting their economies. South Africa has, similarly, implemented a range of policies – including incentives aimed at attracting FDI. This study analyses the inward trends of FDI for South Africa and the key determinants of FDI. The study uses as variables annual key economic indicators such as gross domestic product (GDP), government size (GOVSIZ), export/import trade, the exchange rate, inflation and the interest rate, for the period 1970 to 2013. The study reviews global FDI trends and their geographic distribution as well as FDI trends in Africa and in key sectors, including FDI trends and FDI policy in South Africa. The literature review analyses the fundamental theories of international trade and foreign investment. A number of empirical researches indicate that factors such as skilled labour, infrastructure, financial development, political stability, market size, natural resources and better economic management (comparatively speaking) are key determinants for FDI. Following the theoretical review, the formulation of an empirical model to estimate the empirical determinants of South African FDI is discussed. The use of Johansen cointegration and the vector error correction model (VECM) framework is described. The discussion of cointegration analysis includes the use of impulse response and decomposition analysis to establish the long- and short-run determinants of FDI in South Africa. The results from the trend analysis showed that South Africa is still performing poorly in terms of receiving FDI when compared to other developing countries in regions such as Latin America and South Asia. The information and communications technology (ICT) and financial services sector are currently the major recipient of FDI, followed by manufacturing and mining. The USA, followed by the UK, are the primary sources of FDI in South Africa. The empirical results showed that FDI, GDP, GOVSIZ, trade, inflation, exchange and return on credit were long-run determinants. The VECM results revealed that GDP, GOVSIZ, trade openness and return on credit tend to have a positive impact on FDI, whereas the exchange rate and inflation have a negative impact on it.

Thesis (MDF)--Stellenbosch University, 2015. / ENGLISH ABSTRACT: This work empirically examines South African data covering the years 1956-2011 to look into the relationship between FDI and inequality. By investigating how FDI is linked to inequality, policy makers would be better poised to develop policies that optimise on the benefits of FDI without the dampening effect of inequality. The benefits of FDI, particularly to the South African economy, are that it provides capital to finance investment by bridging the savings gap in the country. In addition to that, FDI facilitates transfer of technology and managerial skills from the source country. Moreover, FDI has a positive impact on balance of payment not only because of the impact capital inflow has on balance of payment, but because FDI also promotes exports of the country to world markets. Empirical evidence presented in literature suggests that the FDI-inequality relationship is complex. In some locations, for example in the US, Latin America and in some developing countries, FDI tends to raise income inequality. In other locations evidence is inconclusive. The results of this study showed that there is a negative relationship between inequality and foreign direct investment for the period examined in the study. This finding is not consistent with the a priori expectation that foreign direct investment increases inequality. Contrary to what has been predicted, the findings show that foreign direct investment is likely to reduce inequality. The findings also show that there is a statistically significant and positive relationship between GDP and inequality.