“This paper analyses South Africa’s relationship with sustainable inward
foreign direct investment (FDI). It examines South Africa’s balancing act of
promoting FDI that brings inclusive economic development while remaining
an attractive FDI destination for investors. It first gives a brief overview of South Africa’s current FDI context, with particular focus on the dynamics of
international mergers and acquisitions and how South Africa’s competition
and domestic policy frameworks affect these types of investments. Walmart’s
acquisition of Massmart is employed to demonstrate the challenge of ensuring
that FDI has positive spillover effects for South Africans within the context of
increasingly globalised production chains. Ultimately, the paper focuses on
South Africa’s future path towards more sustainable FDI, and the last section
therefore analyses the government’s current efforts to create a domestic
FDI regulatory framework. It then explores additional efforts to promote
sustainable FDI such as the one-stop shop for investors and new public
interest guidelines for competition, as well as prospects for a mechanism to
support small, medium and micro-sized enterprise suppliers.”
