Analysing the Role of Good Corporate Governance in TVET Colleges in South Africa

The main purpose of the study was to analyse the role of good corporate governance in TVET colleges in South Africa (SA).The study employed qualitative methods using secondary data from various credible publications. From a theoretical perspective, the study discovered that, corporate governance plays a pivotal role in TVET colleges to certify equal treatment of shareholders,  integrity and business ethics, conflict resolution, accountability and transparency in all spheres of their operations and leadership. In the same vein, empirical studies examined indicated that, TVET colleges face a myriad of challenges such as lack of effective leadership and sound administration; inadequate and misappropriation of funds as well as weak accountability. Furthermore, TVET colleges also experience inadequate and substandard infrastructure and insufficient equipment thus inter alia. The study recommends that, TVET colleges in SA should leverage on compliance with  good corporate governance principles both internally and externally as contained in the King’s reports of corporate governance. It emerged from the study that, TVET colleges should develop code of practice in line with the CET Act. Likewise, TVET colleges must consider training in King codes and other relevant governance codes so as to reap fully the rewards of good corporate governance within their space. Keywords: Corporate governance, performance, management DOI: 10.7176/PPAR/11-5-02 Publication date:June 30th 202

Foreign Direct Investment and Economic Growth in South Africa: A Vector Error Correction (VEC) Model Approach

The objective of this research study was to examine the influence of foreign direct investment on economic growth in South Africa during the period 1994-2014. Time series annual data on real gross domestic product (GDP) growth, foreign direct investment, and terms of trade were sourced from the South African Reserve Bank (SARB) historical macroeconomic statistics online database. Unit root and cointegration properties of data were analysed using Augmented Dickey-Fuller and Johansen cointegration test techniques, respectively. The Vector Error Correction model was applied to compute long-run and short-run parameters of endogenous variables in the model. Results of the long-run section of the cointegrating equation show that for every 1 percent rise in foreign direct investment, there was a statistically significant rise in growth of gross domestic product by about 0.05 percentage points during the period 1994-2014. Results of the error correction component of the gross domestic product growth equation show that about 62 percent of the deviance from the long-run stability pathway was rectified in the first year after the deviation occurred. Results of the impulse response functions indicate that a one standard deviation in foreign direct investment had a statistically significant and positive effect on future gross domestic product growth after the first year. Keywords: Foreign direct investment (FDI), gross domestic product (GDP) growth, Vector Error Correction (VEC) model DOI: 10.7176/JESD/12-12-01 Publication date:June 30th 202

Infrastructure and Foreign Direct Investment Inflows in South Africa: An Engle-Granger Error Correction Model Approach

The aim of this study was to examine the impacts of infrastructure quality and infrastructure investment on foreign direct investment in South Africa over the period 1970-2015. Time series annual data on foreign direct investment, infrastructure quality, infrastructure investment, financial market development, market size, macroeconomic stability and trade openness indicators were collected from relevant sources. Unit root tests were done using Augmented Dickey-Fuller and Phillips Perron methods, while cointegration was tested using the Johansen cointegration approach. The Engle-Granger error correction model was used to compute long-run and short-run estimates of the model. Results of the first step long-run segment show that trade openness, market size and infrastructure quality had statistically significant and positive impacts on FDI inflows. Macroeconomic stability had a significant and negative impact on FDI inflows, while financial market development and infrastructure investment had insignificant and negative impacts on FDI inflows. In the short run, the error correction term shows that 50.7% of disequilibrium in FDI inflows was corrected within a period of one year. Market size, macroeconomic stability and infrastructure investment had statistically significant and negative impacts on FDI inflows into South Africa over the sample period under review. Infrastructure quality, financial development and trade openness had positive but insignificant impacts on FDI inflows into the country. The estimated model passed all the diagnostic and stability tests. Keywords: Foreign direct investment (FDI) inflows, infrastructure quantity, infrastructure quality, Engle-Granger Error Correction Model DOI: 10.7176/JESD/12-12-02 Publication date:June 30th 202