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Essay / Research Paper Abstract
A 3 page paper. Using a case study scenario provided by the student, this essay responds to three issues: the costs and benefits of FDI in South Africa, how companies can fairly consider opportunities and threats of investing in the region, and what policies South Africa should adopt to increase FDI. No Bibliography.
Page Count:
3 pages (~225 words per page)
File: MM12_PGfdesa.rtf
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Unformatted sample text from the term paper:
less? Foreign direct investment (FDI) offers many benefits to the country, including employment and competition. Multinational companies would force local enterprises to be more innovative and to raise the quality
of their products and services. FDI would also diversify the economy, bringing new products and services. During the apartheid era, unemployment rates reached as high as 26 percent. While lower
today, the economy has been dominated by a number of huge conglomerates that were formed. Companies tend to innovate and produce quality items when there is competition in the market.
further, the economic market is reliant on a few products. The costs of FDI have to do with improving the physical infrastructure and reducing social problems. The government will
also need to change conditions, such as reducing the crime rate, all of which would add costs. More FDI can bring positive changes to the economy. Less FDI will
leave the country stymied in terms of economic growth. 2. How might a company try to weigh fairly the opportunities and threats of investing in South Africa? Companies invest
in countries when there is a large market for their products and when the conditions are such that their companies will be able to operate smoothly. Such is not the
case in South Africa. There is ongoing civil unrest, high rates of crime, one of the highest rates of AIDS in the world, rigid labor laws, low growth rates in
the countries in this region and high levels of corruption. Having threats from Zimbabwe and Angola, the region is further unstable. One survey that asked what limits FDI in South
Africa revealed "extortion, bribery, and the difficulty in accessing global market . . . poor access to capital, high administrative costs, and defective physical infrastructure." (Student, you need to include
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