The political economy of Indian and Chinese foreign direct investment and multinationals in sub-saharan Africa

[摘要] ENGLISH ABSTRACT: Africa's rising international profile and geopolitical significance as well as thecontinent's relatively 'under-exploited markets' have been pull factors for manyemerging economies. Globally, the developing and emerging economies of the worldfor the first time captured more than half of all global FDI in 2011. Changes in theglobal investment regime are a clear indication of the changing dynamics in the globaleconomy. Since India and China's FDI liberalisation processes began to gather steamin the 1990s, they have been amongst the most aggressive of the emerging economyinvestors. This study appraises the role of the government in facilitating investment byIndian and Chinese firms abroad, specifically Sub-Saharan Africa. The study analysesthe motivations for such outward foreign direct invest flows, the sectoral trends, andthe entry mode differences of Indian and Chinese firms' investments in Sub-SaharanAfrican markets. Yet, there is a lack of studies that focus on both Indian and Chineseinvestments in Sub-Saharan Africa.Drawing from theoretical constructs from political economy, International business/economics and International Political Economy - a framework is provided to assessthe influence of these investments. The methodology is interpretive and qualitativeand draws largely on secondary material from international organisations, governmentagencies, academic literature and the media. The study finds that the role of NewDelhi and Beijing in facilitating and financing outward investments is strategic andpragmatic. These policies greatly influence firms, and the locations and types of theirinvestments.South-South cooperation provides India and China with a framework for long-termpolitical and economic investments and development cooperation with African states.India and China's engagements in Sub-Saharan Africa share similar and dissimilarforms and motivations for FDI. Markets and resources are primary motivations forthese two countries' firms to invest in the region. India and China's growingcommercial activities in Sub-Saharan Africa provide the region with opportunities forfurther international market integration and development.

[发布机构] Stellenbosch University