AFRICA FDI.

Africa FDI



Africa FDI

Major investors and receivers of FDI continue to be mainly developed nations. Developed nations accounted for approximately 80% of FDI received and the majority investing. Several reasons for this include their political and economic stability as well as developing high technology that spurs investment. Of the Relocation of corporate functions, production is the top corporate function most likely to be relocated abroad, followed closely by distribution and sales and logistics and support services (see exhibit 1). By investing abroad firms hope to gain access to foreign markets and technology, improve their efficiency and enhance their firms' specific advantages. Some of the key drivers of FDI continue to be the growing capabilities of firms including those in developing nations, strong export orientation, the desire to access technology and control of strategic assets and resources abroad, both services and natural resources.

Multinational corporations have funneled foreign direct investments intoAfrica due to the diverseness and rich resources that has made Africa very desirable. Unfortunately, there have also been many economic and political entanglements that have influenced, and in some cases, stalled the influx of foreign direct investment. Facing this economic reality, Africa has had to make significant improvements in order to foster an environment that would attract investors. (Axel 2007 p.15-19)

Africa is at the southern tip of the continent of Africa. The terrain of Africa can vary from farmland to tall mountain ranges. What is not obvious is that underneath those mountain ranges are vast amounts of crystalline rock formations. This is an invaluable resource, because this allows Africa to be the world's largest producer of gold. It is also instrumental in allowing this country to be a top exporter of coal, diamonds and platinum. Africa also has a very diverse population that is made up of many different races and ethnic groups. Although for most countries this is desirable, Africa has suffered due to its diversity in many various ways.

The population of Africa is 24 million and it is composed of multiracial and multiethnic people of all walks of life. Three quarters of the population is black and they represent various tribes as the Zulu, Xhosa, Sotho, and Tswana. The remainder is Caucasian, Indian, Asian and mixed race. There is an obvious racial distortion when looking at where the population lives. Blacks live in shantytowns located outside of the city limits. Whites, Asians and other races live in the city limits. Racism is obvious by the living conditions of the minorities in this country and has become a way of life.

Africa's government goes back to 1910; this is when the Union of Africa was formed. Congress was the actual decision maker even though there was a monarch on the throne. Africa and other British Commonwealths were given their freedom from Britain and became a republic in 1961. Once the new republic was established so was a democratic government that consisted of a president and a three-house parliament. But unfortunately, there was no minority representation in the newly established ...