South African ambitious investment objectives: The current foreign direct investment determinants in South Africa

Abstract

The newly elected South African President, Cyril Ramaphosa, set an ambitious objective to attract US$100 billion Foreign Direct Investment (FDI) for South Africa’s sustainable socio-economic development. This paper determines differential factors that influence the flow of FDI into South Africa. The objective of this study is to assess factors that affect the flow of FDI into South Africa. Data analysis is performed from the 217 foreign exchange practitioners, registered and working at the Johannesburg Stock Exchange in South Africa by performing both ordered logit and Bayesian analyses. Our results showed that the following are the most important FDI determinants factors: (1) the provision of economic incentives; (2) trade regulation and policies; and (3) high expectations of economic return on investments.

Keywords:

• economically enabling environment
• Foreign Direct Investment
• odds ratio
• South Africa

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This work was supported by the South African National Research Foundation and Tshwane University of Technology.