The role of Foreign Direct Investment (FDI) in transforming South Africa into a manufacturing hub Combating Unemployment and fostering economic growth.
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| Format: | Thesis |
| Kulcsszavak: | Dél-Afrika economic development economic forecasting economic growth fdi Foreign Direct Investment gazdasági növekedés Manufacturing Analysis munkanélküliség |
| Online Access: | http://dolgozattar.uni-bge.hu/59126 |
| Abstract: | This study examines the impact of Foreign Direct Investment (FDI) on South Africa’sthe manufacturing sector, focusing on employment creation and economic growth, using data from1970 to 2023. As South Africa grapples with high unemployment and persistent economicinequality, the research investigates whether FDI directed at manufacturing can facilitate amore inclusive growth path compared to capital-intensive sectors such as mining and finance.Utilising annual macroeconomic data and applying quantitative analysis, including descriptivestatistics, correlation, and multiple regression, this study finds that FDI inflow does not have astatistically significant positive relationship with manufacturing output. Moreover, GDP showsa strong negative correlation with manufacturing, suggesting a structural shift in the SouthAfrican economy away from industrial productivity towards service and extraction. Theanalysis further identifies a lack of sector-specific FDI data and lagged investment effects askey limitations.The findings of the study have challenged the conventional narrative that FDI uniformlypromotes industrial development. Instead, they showcased the need for strategic, policy-drivenFDI allocation, specifically towards labour-intensive and value-adding sectors aligned withSouth Africa’s industrial policy and the Vision 2023 development goal. The study contributesto both academic literature and national policy discourse, calling for more nuanced approachesto FDI attraction, the development of emerging economies, and for the South Africangovernment to readdress their policy and sectoral prioritisation strategy. |
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