Policy Framework for Foreign Direct Investment Promotion in South Africa: Operations, Effectiveness and Sustainability

The paper examines the fragmented nature of investment promotion in South Africa, where provincial agencies operate with varying levels of professionalism and often compete against one another. It highlights a gap between investment regulation—exemplified by the Promotion and Protection of Investment Bill of 2013—and investment promotion. The author recommends that Trade and Investment South Africa (TISA) implement a more coordinated national framework, including a central 'one-stop shop' and a formal referral system, to attract high-quality, sustainable FDI that aligns with national development goals.

• South Africa's investment promotion system is highly decentralized, with provincial investment promotion agencies (IPAs) often operating as units within larger provincial economic development agencies rather than as independent entities.
• There is a significant disparity in the professional capacity and performance of provincial IPAs, ranging from agencies with high-quality websites and rigorous performance evaluations to those with poor communication and institutional mismanagement.
• The decentralized structure fosters fierce competition between provinces for FDI, which can lead to wasteful duplication of efforts, such as multiple agencies sending separate missions abroad.
• The 2013 Promotion and Protection Investment Bill focuses on investment regulation and the government's ability to pursue social and economic goals, but it lacks direct discussion or integration of investment promotion activities.
• The Gauteng Investment Centre serves as a 'one-stop shop' for business support services, a model that TISA considers a prototype for other provinces to potentially emulate.
• To improve sustainability and coordination, the author recommends that TISA establish a national central hub, a single unified website for all provinces, and a formal inter-provincial referral system.

APA

Sharp, M. (2015). Policy Framework for Foreign Direct Investment Promotion in South Africa: Operations, Effectiveness and Sustainability. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2015/04/Occasional-Paper-215.pdf

Chicago

Sharp, Matthew. Policy Framework for Foreign Direct Investment Promotion in South Africa: Operations, Effectiveness and Sustainability. South African Institute of International Affairs, 2015. https://saiia.org.za/wp-content/uploads/2015/04/Occasional-Paper-215.pdf.

Wikipedia

{{cite report |last1=Sharp |first1=Matthew |title=Policy Framework for Foreign Direct Investment Promotion in South Africa: Operations, Effectiveness and Sustainability |publisher=South African Institute of International Affairs |date=May 2015 |url=https://saiia.org.za/wp-content/uploads/2015/04/Occasional-Paper-215.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sharp2015policy, author = {Sharp, Matthew}, title = {{Policy Framework for Foreign Direct Investment Promotion in South Africa: Operations, Effectiveness and Sustainability}}, institution = {South African Institute of International Affairs}, year = {2015}, month = may, url = {https://saiia.org.za/wp-content/uploads/2015/04/Occasional-Paper-215.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }