Our Research posts are about the latest academic research being done in the School of Economics. This week we are happy to link to a research brief that Dr Henri Bezuidenhout published for SAIIA’s Economic Diplomacy programme.
The global arena for foreign direct investment (FDI) has become much more fluid and complex in the five years from 2010 to 2015. The Southern African Development Community (SADC) as a region has shown exceptional growth but relatively lacklustre FDI inflows. Investment protocols might be revised, as SADC needs to re-envisage itself as an investment destination. It currently receives mostly resource-based investment in subsequent supporting service industries. The end of 2014 saw sharp declines in commodity prices, especially oil, and forecasts show a sluggish return to previous levels. This requires SADC policymakers to take a new look at current investment policies and attitudes. Global value chains and spatial factors show that dated ideological policymaking will need to be replaced with proven, growth-orientated developmental strategies.