An Assessment of the Investment Climate in South Africa

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World Bank Publications, May 10, 2007 - Business & Economics - 154 pages
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Most aspects of South Africa's investment climate the location-specific factors that shape opportunities and incentives for firms to invest productively, create jobs, and grow are favorable. The majority of large, registered firms believe that the legal system is able to protect their property rights. Infrastructure is reliable. Tax rates are relatively low. The burden of regulation is comparable to other middle-income countrries. Few firms pay bribes. And most firms have adequate access to credit. In many dimensions, South Africa has a good investment climate. Consistent with this, large South African firms are very productive. Labor productivity is far higher than in the most productive low-income countries in Sub-Saharan Africa and compares favorably with other middle-income countries such as Brazil, Lithuania, Malaysia, and Poland. And although labor productivity in South Africa is slightly lower than in the most productive cities in China, it is over three times higher than in China as a whole. So, why hasn't South Africa been growing faster? As this title explores, while the investment climate is generally favorable, some problems remain. Firms appear to be particularly concerned about four areas: difficulty hiring skilled and educated workers, rigid labor regulations, exchange rate instability, and crime. Using rigorous statistical information on these and related topics, the book aims to assist policy makers and private sector stakeholders in developing reforms that will improve firm performance and growth.
 

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Contents

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Page 68 - Chapter 2 of the act states that a person may not be unfairly discriminated against on the basis of race, gender, pregnancy, marital status, family responsibility, ethnic or social origin, color, sexual orientation, age, disability, religion, HIV status, conscience, belief, political opinion, culture, language, or birth.
Page 26 - Significant at 1 percent level. " Significant at 5 percent level. ' Significant at 10 percent level.
Page xiii - The investment climate reflects the many location-specific factors that shape the opportunities and incentives for firms to invest productively, create jobs, and expand.
Page xi - The authors wish to acknowledge the support of the Department of Trade and Industry (DTI) who sponsored this research.
Page 66 - ... protected disclosure as defined by the Act. Despite these provisions, however, a dismissal may be fair if the reason for dismissal is based on an inherent requirement of the particular job. Unfair dismissals In terms of section 188 of the LRA, a dismissal that is not automatically unfair is nonetheless unfair if the employer fails to prove that the reason for dismissal is a fair reason related to the employee's conduct or capacity, or is based on the employer's operational requirements, and that...
Page 38 - ... both hypotheses to some degree. Several econometric studies have found that productivity improvements precede exporting, providing support for the self-selectivity hypothesis. But case studies often support the learning-by-exporting hypothesis. Studies of exporters in South Korea and Taiwan, China, found that export buyers were an important source for new technologies, which they provided in forms including blueprints, information about manufacturing processes and quality control methods, technical...
Page 28 - ... discipline of competing in international markets encourages firms to improve their productivity or exposes them to foreign technologies and modes of production. In addition, exporting allows firms to achieve greater economies of scale by expanding their potential market. The second explanation is that because firms have to be efficient to compete in international markets, only firms that are already efficient can export (the self-selectivity hypothesis). Although inefficient firms might prosper...
Page xxv - OECD Organisation for Economic Cooperation and Development SACU Southern African Customs Union...
Page 38 - ... exporting. The two hypotheses are not mutually exclusive. Even if efficient firms are more likely to start exporting, this does not rule out the possibility that exporting will help them increase their productivity further. The evidence supports both hypotheses to some degree. Several econometric studies have found that productivity improvements precede exporting, providing support for the self-selectivity hypothesis. But case studies often support the learning-by-exporting hypothesis. Studies...
Page 1 - These rules affect investment uncertainty and risk as well as investment safeguards (protection of property rights, enforcement of contracts, and maintenance of integrity of monetary standards).

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