Browsing by Subject "FDI"

Now showing 1 - 3 of 3
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    Open Access
    Impact of air connectivity on tourism, FDI and trade: insight from the Western Cape
    (2020) Nonyati, Sibusiso; Alhassan, Abdul Latif
    This study investigated the impact of air connectivity on macroeconomic factors, specifically tourism, FDI and trade in the Western Cape, based on quarterly data from 2010 to 2018. The Autoregressive Distributed Lag (ARDL) bounds approach for cointegration was used to assess whether long-run relationships existed between air connectivity and tourism, FDI and trade. The ARDL bounds test found a cointegrated relationship between air connectivity and tourism, FDI and trade respectively. Air connectivity was found to have a positive and significant long-run relationship with tourism This also supports the literature findings that air connectivity improves countries' accessibility and increases tourist arrivals from various markets. This confirms that air connectivity leads to an increase in the number of international tourists visiting the Western Cape, which contributes significantly to the tourism industry and the Western Cape economy. In addition, air connectivity was observed to have a positive but statistically insignificant long-run relationship with FDI and trade respectively. Therefore, this study concludes that air connectivity plays a key role in the economy, specifically regarding tourism through the facilitation of more tourists into the Western Cape. Furthermore, although the study showed positive and insignificant relationships between air connectivity and FDI and trade respectively, air connectivity is related to FDI and trade and these relationships require further investigation. Therefore, it is recommended that policymakers and decisionmakers on the African continent need to have initiatives that support the improvement of air connectivity, especially given that Africa has only a 2.2% market share of global air passengers and less than 10% of the continent's population uses air transport. Other African countries and regions should use a similar approach to what the Western Cape has done to improve the air connectivity between Cape Town and the rest of the world. In addition, investment in airports and airport-related infrastructure is critical and necessary, as poor airport infrastructure has been cited to be one of the obstacles in improving air connectivity in the continent. Furthermore, the development of an air connectivity index for the continent is required. This index will have to take into account the availability of data and the African context. Where data does not exist, a robust plan for the collection of data will also have to be developed. Lastly, the regulation of the aviation market needs urgent attention, starting with an Open Skies policy. The deregulation of air access could play a significant role in improving the African Continent's air connectivity.
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    Open Access
    The relationship between corruption, ease of doing business and FDI inflows in SADC countries
    (2021) Matete, Desmond; Gossel, Sean J
    Globalisation and trade integration have positioned Foreign Direct Investment (FDI) as a development imperative for many developing countries, including Southern African Development Community (SADC) economies. Despite concerted efforts both at individual country level and at regional level, FDI flows to the SADC region have declined compared to other regions in the world. The main reasons posited for SADC's inability to attract and retain FDI include negative risk perceptions; a weak ease of doing business environment, and endemic corruption. Hence, the study seeks to investigate the relationship between FDI inflows and corruption and ease of doing business in SADC. The research applies Generalised Method of Moments (GMM) analysis to all 16 SADC countries over a period of 2010 to 2019. The results show that although both corruption and ease of doing business are significantly and positively relate to FDI inflows in SADC, ease of doing business affects FDI to a greater extent compared to corruption. In addition, the inclusion of the interaction between corruption and ease of doing business shows that FDI inflows are more closely attracted by ease of doing business than by corruption.
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    Understanding the role of public preferential procurement on the development of black owned construction SMME'S IN South Africa
    (2020) Nzo, Khulile; Alhassan, Abdul Latif
    The research explored the long-term relationship between FDI, GDP and host country employment by using sector-wise panel data from 1991 to 2017 in Namibia. The study applied unit root testing and Cointegration test to test for the presence of a cointegration relationship between the variables. Also, a vector autoregression model short-run causality among the variables was examined. In the end, Impulse response functions are estimated. The research found both a short term and long-term causality going from FDI inflow to employment. Impulse responses show that both GDP and employment respond positively to an exogenous shock in FDI inflow. However, the employment response to FDI inflow shock is smaller than that of GDP response. The paper also concludes that FDI has no causal effects on economic growth in Namibia. It means that economic growth is not contributed by the FDI significantly the results in this research have some significant policy implications. Therefore, as the results suggest that the FDI inflow has a positive impact on employment, because of the results, the researcher also recommends that Namibia pursue the policy of attracting foreign firms aggressively and create all the conditions required for attracting foreign direct investment in order to create further employment opportunities.