Is there a link between BRIC foreign direct investment and SADC export performance?
Development Southern Africa
TRADE research entity, North-West University, Private Bag X6001, Potchefstroom, South Africa; University of Pretoria, Private Bag X20, Hatfield, Pretoria, South Africa
The BRICS (Brazil, Russia, India, China and South Africa) countries have agreed to strengthen their economic ties, thus paving the way for enhanced trade and investment performance. South Africa’s strategic value in BRICS is that it is a gateway to the opportunity-rich Southern African Development Community (SADC). By using South Africa as a production hub for exports to the surrounding region, foreign investors would have ready access to neighbouring markets. This article addresses the question of whether, and in what ways, foreign direct investment (FDI) from the BRIC (Brazil, Russia, India and China) countries to the SADC influences the SADC’s export performance. A series of empirical analyses revealed a positive causation between BRIC FDI and SADC exports, offering a clear incentive for the SADC to rejuvenate its trade and investment policies and structures, and strengthen its ties with BRIC countries in the interests of attracting more FDI and building a strong and sustainable export sector. © 2015 Government Technical Advisory Centre (GTAC).
export; foreign direct investment; Southern African Development Community; trade; Brazil; China; India; Russian Federation; South Africa