The foreign direct investments and their impact on Canadian and South African telecommunications industry

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2008

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University of Cape Town

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The scope of this paper is to demonstrate that countries should abolish the restrictions on FDI in order to create a successful telecommunications market. FDI can increase competition with amazing consequences for consumers. In Canada, FDI restrictions apply on basic suppliers and are a major burden for companies competing in this market. The illustration of this issue occurred with the take over of one of the incumbent companies, Bell Canada Enterprise (BCE). In South Africa, the telecommunications industry is stagnate and needs the influx of FDI to compete on an international level. FDI restrictions thwart the expansion of the South African telecommunications industry by turning down foreign capital. Countries around the world are benefiting from FDI and it is time for Canada and South Africa to liberalise their telecommunications market and step forward in this new trend.
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