Abstract
Notwithstanding its struggles to tame the high levels of poverty and inequality, South Africa is considered as a major economic hub of Africa. However, as an economic hub, there are other countries that perceive South Africa as a capitalist, neo-liberal economy that goes all out to dominate not only its neighbors in the southern hemisphere, but also many other developing nations in the continent. Therefore, the main aim of the study is to assess the socio-economic implications of South Africa’s foreign direct investment in Southern Africa. As far as the authors are concerned, there is yet to be a frank analyses of the varying perspectives, as well as a holistic explanation of the clearly, yet complex relationship which exists between South Africa and many other countries in the southern hemisphere. While the authors acknowledge the efforts of several scholars in trying to juxtapoze the nuances in these relationships, they insist that there has not been a contextual treatment with due consideration for the socio-economic implications of South African business expansion in Africa. Thus, the authors sincerely believe that the paper has serious implications for emerging economies especially in Africa. Other African countries can learn from South Africa’s tactical brilliance; the way it has positioned its economy as a major economic hub in Africa with illustrious attractions that are derived from sophisticated infrastructure, a good educational system, a functional health care system and world class standard ecotourism. The study was conducted using documentary analysis and, therefore, allowed the researchers to source and utilize documents, both in private and public domain, on the basis of their relevance to the research. Keywords: democracy, foreign direct investment, public administration, Southern African Development Community, Southern African Customs Union, Southern African Power Pool, regional cooperation. JEL Classification: H5, N27, 016, 019, 024, 055
Highlights
As a new democracy, South Africa (SA) is considered as a major economic hub of Africa
The widespread opinion is that SA’s neo-liberal economic policy depicts it as a sub-imperial state in the continent of Africa. While this position is debatable among scholars and analysts, it is commonly understood that business practices of South African firms have firmly entrenched it as an imposing partner through its attempt to craft unequal relations with other states in Africa mostly in Southern African Development Community (SADC) sub-region
Many are of the view that SA is an emerging power, capitalist or hegemony in its relations with SADC sub-region due to its foreign direct investment (FDI) activities (Habib & Langsberg, 2003; Mandela, 2010)
Summary
South Africa (SA) is considered as a major economic hub of Africa. Inequality in the country since democracy in 1994 remains one of the highest around the globe, because an estimated 40% of the SA national income goes to only 10% of its population. ‘Our country is characterized by two parallel economies, the first and the second. Samuel Augustine Umezurike, Chux Gervase Iwu, Lucky Asuelime, 2016. Samuel Augustine Umezurike, Dr, Department of Public Administration, Faculty of Commerce, Administration and Law, University of Zululand, South Africa. Chux Gervase Iwu, Professor, Department of Entrepreneurship and Business Management, Faculty of Business and Management Sciences, Cape Peninsula University of Technology, South Africa. Lucky Asuelime, Dr, Department of Politics and International Studies, Faculty of Arts, University of Zululand, South Africa. For the needed positive result in the socio-political economy of the rainbow nation to take place, a new but workable approach is required. Leaning towards a trend whereby neo-liberalism expressed in form of deregulation and tax cuts is encouraged. 2
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