Aftercare of inward foreign direct investment: A case study of South Africa

Abstract

Attraction of new inward foreign direct investment (FDI) globally, especially in the developing countries, is problematic. Economic development practitioners have recently started to prioritise the retention and growing of existing investments to enhance their economic development agenda. The purpose of this paper is to analyse and investigate the relationship between inward FDI and investment aftercare in South Africa (SA). Only a few studies have been carried out on the topic at the global level and none on SA as far as could be ascertained. A structured questionnaire was used to collate data, and 30 face-to-face interviews were conducted with 16 investment aftercare practitioners and 14 executives from the investment promotion agencies (IPAs) in seven of the nine provinces of SA. The main finding of the study is that although investment aftercare services are essential, they receive limited funding, staff and attention, and have not yet been developed in SA.