> > Charles Brown wrote: > >On the other hand, the industrial plants established in Korea, > >Mexico, Brazil, China (et al ? South Africa) in the last 20 years > >continue the export of capital trend that Lenin (Hobson ?) marked. If anyone's interested in South Africa, the 1980s witnessed TNC disinvestment, for reasons we can all be proud of. The 1990s witnessed FDI stagnation because the late-apartheid regime and the first democratic government both adopted demand-dampening macroeconomic policies, including the highest real interest rates in SA history. Two 'grafs from a recent paper: Virtually all FDI into post-apartheid South Africa has been of the merger/acquisition variety, instead of into greenfield projects entailing the import and establishment of new plant, equipment and job opportunities. Moreover, since the financial rand (SA's dual exchange rate) was lifted in 1995, more than R10 billion more has been exported through South African firms' direct investment out of the country, than new FDI into South Africa (today R6=US$1). In SA, Foreign Direct Investment is measured as foreign equity purchases of 10% of a company's voting rights. Notwithstanding the large (30%) sale of Telkom to a US-Malaysian consortium in 1997, 1990s FDI inflows have been substantially less than the direct investment abroad of South African firms (mainly mining houses). In 1994, for example, FDI was recorded at R1,1 billion, with SA outward investment R4,2 billion. In 1995, both increased: FDI to R4,2 billion but outward SA investment to R9,0 billion. In 1996, FDI was R3,5 billion and outward SA investment was R4,2 billion. In 1997, FDI rose on the basis mainly of the Telkom and Sun Air privatisations to R17,6 billion and outward SA investment rose to R10,6 billion. In 1998, FDI fell dramatically, to R3,1 billion, while outward SA investment fell slightly, to R9,6 billion. In the first quarter of 1999, FDI was R2,0 billion and outward SA investment was R4,3 billion. In nominal terms, the 1994-99 direct investment flow, therefore, included R31,5 billion FDI and R41,9 billion in outward SA investment, for a net negative R10,4 billion.
