Thesis (MA)--University of Stellenbosch, 2003. / ENGLISH ABSTRACT: Instability in foreign political and social systems, changing power structures in
international relations, and growing demands by host countries for a greater control
over the operations of multinational enterprises (MNEs) have all led to the necessity
of an improved way in which to determine foreign investment opportunities. Not
surprisingly therefore, political risk assessment has become one of the fastest growing
fields of study. Being concerned with the identification, analysis, management, and
reduction of socio-political risks for foreign investors. The focus of this study is that
of political risk analysis and the way in which it impacts on investor perception and
consequently determines levels of foreign direct investment received by a particular
country.
Numerous definitions for the term "political risk" exist. Consequently, no specific
definition is regarded as being completely correct since consensus still needs to be
reached. One of the definitions used within this study is that political risk analysis is
the analysis of the possibility that factors caused or influenced by governmental
political decisions or other unforeseen events in a country will affect business
climates in such a way that investors will lose money or not make as much profit as
they expected when the initial decision to invest was made. These factors can be of
internal (from inside the host country) or external origin, and can pose macro or micro
risks. Foreign Direct Investment in brief is an investment involving a long-term
relationship and reflecting a lasting interest and control of a resident entity in one
economy in an enterprise resident in an economy other than that of the foreign direct
investor.
This study is a comparative between South Africa and Nigeria. South Africa and
Nigeria share many similarities, they are both resource based, African countries. They
are both fairly recent democracies, although some may contest the status of Nigeria as
being a democracy. They are also both heterogeneous states, both consisting of
various ethnic groups. Nigeria offers investors a low-cost labour pool, abundant natural resources, and a
large domestic market. However, Nigeria suffers from an inadequate and poorly
maintained infrastructure, confusing and inconsistent regulations, endemic corruption,
and a lack of confidence in the rule of law. Despite all of this, Nigeria alone accounts
for a quarter of FDI flows to Africa. In comparison, South Africa's FDI potential has
not been fully exploited. This study will discuss the possible reasons why this is the
case.
The labour market in both countries and the challenges they face are discussed in
depth within this study. Due to the fact that aside from investment, the economic
growth within a country is dependent on a variety of factors, the backbone of which is
the labour market.
In determining levels of risk within both South Africa and Nigeria, this study made
use of a political risk model. Although the intention has been to be as accurate and as
thorough as possible, it should be noted that as yet, no generalised systematic method
of conducting political risk assessment exists. Results, although extensively
substantiated, remains the interpretation of the researcher and as such remains open to
debate. / AFRIKAANSE OPSOMMING: Onstabiliteit in buitelandse politieke en sosiale stelsels, veranderende mag strukture in
internasionale betrekkinge, en die groeiende behoeftes van gasheer lande om meer
beheer uit te oefen oor die funksioneering van buitelandse maatskappye het alles gelei
na die noodsaaklikheid van 'n beter manier om buitelandse investering te bepaal. Dus
is dit nie verbasend dat politieke risiko analise deesdae een van die vinnigste
ontwikkelende onderwerpe is wat bestudeer word nie. Politieke risiko analise is
belangrik vir die identifikasie, analise, bestuur en vermindering van sosio-politieke
risiko vir buitelandse investering. Hierdie studie fokus op die impak wat politieke
risiko' analise het met betrekking tot belegger waarneming en hoe dit dan ook
moontlik die bedrag van buitelandse investering wat 'n land ontvang, kan bepaal.
Daar is verskeie definisies wat die term "politieke risiko" beskryf en gevolglik moet
konsensus nog bereik word oor 'n "korrekte" een. Een van die definisies wat in hierdie
studie gebruik word is dat politieke risiko die analise is van die moontlikheid dat
sekere faktore wat veroorsaak is of wat beïnvloed is deur die regering se politieke
besluite, asook ander onvoorspelbare gebeurtenise in 'n land wat die investerings
klimaat so kan beïnvloed dat die buitelandse beleggers moontlik geld kan verloor of
miskien nie die verwagte winste behaal wat hulle aanvanklik gereken het, sou behaal
nie. Hierdie faktore kan of intern (binne die gasheer land) of ekstern van aard wees en
kan dus makro of mikro risiko behels. Direkte buitelandse investering in 'n land is 'n
belegging wat In lang termyn verhouding insluit en dit reflekteer ook 'n blywende
belangstelling en beheer van 'n buitelandse maatskappy in 'n gasheer land in.
Hierdie studie is 'n vergelykende studie tussen Suid-Afrika en Nigerië. Suid-Afrika en
Nigerië deel baie ooreenkomste. Beide lande is ryk aan natuurlike bronne en beide is
nog "jong" demokratiese lande. Sommige mense stem nie saam dat Nigerië wel aan al
die vereistes van 'n demokrasie voldoen nie. Suid-Afrika en Nigerië is ook heterogene
state wat uit verskeie etniese groepe bestaan. Nigerië bied vir die buitelandse belegger billike arbeid, oorvloedige natuurlike
bronne, asook In groot binnelandse mark. Ten spyte hiervan, moet dit ook in ag
geneem word dat Nigerië onder onvoldoende en In swak instandhouding van
infrastruktuur, wispelturige regulasies, korrupsie en ook In swak regsisteem ly. Ten
spyte van al hierdie faktore, ontvang Nigerië In kwart van alle buitelandse investering
in Afrika. Suid-Afrika se buitelandse investerings potensiaal in vergelyking met ander
lande moet nog ontwikkel word. Hierdie studie sal die moontlike redes vir Suid
Afrika se oneksploiteerbare buitelandse investerings potensiaal bespreek.
Die arbeidsmark en die uitdagings wat gestel word het In groot invloed op buitelandse
investering. Hierdie studie het ten doelom beide lande se arbeidsmark te bespreek en
te vergelyk met betrekking tot buitelandse investering.
Om die moontlike risiko in altwee lande te bepaal, maak hierdie studie gebruik van In
politieke risiko analise model. Die navorser het gepoog om so deeglik en akkuraat as
moontlik te wees. Dit moet ook in ag geneem word dat daar nog geen veralgemeende
metode van politieke risiko analise ontwikkel is nie.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/53430 |
| Date | 04 1900 |
| Creators | Pekeur, Juanita |
| Contributors | Brink, Charlotte, Stellenbosch University. Faculty of Arts and Social Sciences. Dept. of Political Science. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | English |
| Type | Thesis |
| Format | 102 p. |
| Rights | Stellenbosch University |
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