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MCom Study on Foreign Direct Investment

April 18, 2017

PhD graduates and Husband and Wife Dr Refiloe Khoase and Dr Patrick Ndayizigamiye.

A study on the relationship between foreign direct investment and economic growth in South Africa earned a South African Revenue Service (SARS) employee, Ms Candice Reddy, a Master of Commerce graduate in Economics.

Reddy works in the Macroeconomic Research Division responsible for Economic Modelling and Forecasting at SARS. Her love and passion for economics and for making a difference in the country prompted her to embark on her research.

She said recent years have proven quite challenging for South Africa and growth has been constrained. Hence, she strongly felt that it was particularly important to understand the dynamics of foreign investment in the South African economy as theoretically it should have positive spillovers in the country.

‘My study examined how foreign investment in South Africa impacts the economic growth of the country,’ said Reddy. ‘One of the main findings of the study was that foreign investment and economic growth are negatively related. Even though this was not in line with theoretical expectations, the stage of development that South Africa is currently in could be the reason why foreign investment negatively affects growth.’

She believes government departments would benefit from her study as it would assist in directing growth policy in the country as her research found that the South African economy is more responsive to labour inputs than it is to capital inputs. She said: ‘This finding has important implications for the government’s labour promoting and industrial development policies for the economy.’

Reddy is grateful to her supervisor Mr Abdulkader Mahomedy of the School of Accounting, Economics and Finance and she is extremely proud of her academic achievement which she described as a journey in which she has grown as an individual.

Hazel Langa

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