An evaluation of GEDA’s investment promotion strategies for attracting FDI

Schoeman, Anchen
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Investment promotion agencies (IPAs) around the world are competing to attract foreign direct investment (FDI) to their countries. The competition is especially rife in developing countries and the same holds true for South Africa in its effort to ensure economic growth and development. IPAs are thus tasked with ensuring that effective investment promotion strategies are implemented that will result in a maximum return for their governments. A correlation between investment promotion and FDI has been determined by researchers and acts as one of the catalysts for attracting FDI. GEDA, as the most prominent provincial IPA in South Africa, is at the forefront of dealing with this competitive environment, and determining the effectiveness of its strategies can guide future direction. GEDA, as the case site, was investigated to evaluate how the various investment promotion techniques are applied as part of its investment promotion strategy. In-depth interviews with both GEDA managers and its stakeholder community members were conducted. It was found that GEDA is actively utilising three of the investment techniques - including image building, investment generation and investment facilitation - whilst not pursuing a policy advocacy role in its current scope of activities. Specific quantifiable measures have been put in place to measure the effectiveness of GEDA‟s investment promotion strategies whilst lacking more qualitative measures to determine the quality of products and service offerings. GEDA‟s stakeholder community has a positive perception of GEDA yet also highlights some issues for consideration in future strategies. This research should be of value to Investment Promotion Agencies, multilateral bodies and governments who are seeking a better understanding of investment promotion strategy, the application of promotion techniques, and approaches to measuring performance
MBA thesis - WBS
Gauteng Economic Development Agency, Foreign direct investment