Discuss about the Business Management for World Economic Forum.
According to the Global Competitiveness Report of the World Economic Forum, in recent years, the region of the sub-Saharan Africa has given something about the silver lining in a if not broadly felt worldwide economic downturn. It has been found that this particular report assesses around 144 economies ("Imf.org", 2016). Moreover, on the other hand, the Sub-Saharan economies sustained to record more interesting rates of growth, close to 5 % in the year 2013, along with increasing protuberances for the subsequent two years – below only budding and rising Asia ("Imf.org", 2016). On the contrary, significant risks are found in more than half of 20 least-ranked nations i.e. the sub-Saharan countries and the markets having inadequate infrastructure and deprived levels of basic education and health ("Imf.org", 2016). The main challenge of this particular region is to turn the high rate of growth into an inclusive rate of growth and to make the conversion from the “agriculture based economies” to the “higher value added activities”. As per the Global Competitiveness Report of the World Economic Forum, the markets are ranked on the basis of 12 major measures, which impact competitiveness involving innovation, education and infrastructure ("Weforum.org", 2016).
The “African Renaissance” is the concept regarding the people of Africa and nations that might overcome the present challenges confronting the whole continent and to obtain scientific, economic and cultural renewal (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014). The African Renaissance Institute was established in the year 1999 and its objectives are to develop the human resources of Africa, technology and science, nutrition and health, agriculture, business, culture, good governance and peace ("African Economic Renaissance: The Role of Social Institutions - CASADE", 2014). The most important and main role of this institute now and in future years is to focus on the results of the economic dimensions. It can also be said that the African economic Renaissance is a mixture of political and philosophical movement. Its aims are to bring an end to the elitism, violence, poverty and corruption that have mostly affected the whole continent of Africa and also to replace them by an equitable order.
It has been found that in the year 2015, the economic activity of the Sub-Saharan Africa slumped to its lowermost level in 15 years ("The Keys to an African Economic Renaissance", 2012). The result expanded by about 3.4 % which is little above the growth of population and it is down by 5 % from the year 2014 ("Weforum.org", 2016). The key reason for this sharp slowdown is the decrease in the prices of commodity that has put several countries under harsh sprain along with a prominent affect on the area wide aggregate. Moreover, the experts expect that the growth rate will further get lower in future by 3 % and the reason behind this is that most of the nations struggle with much complicated external environment ("Weforum.org", 2016). In addition to this, it has been found that most of the countries of Sub-Saharan Africa suffer from drought, especially in the southern and eastern part of the continent and this has been identified as the source and the cause of the economic difficulties (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014).
As rightly put forward by Van de Walle (2012), contribution from human perspective involves in analyzing of security risk in and within the context of FDI (Foreign Direct Investment) in Africa. This reveals Exposure towards increased level of security risk resulting from conditions on continent as well as nature. On the contrary, it reveals importance of corporation ability in managing risk in an effective way (The Keys to an African Economic Renaissance. 2012). Security attributes illustrate upon understanding the significance of human perspective and allowing risk analysis for addressing the underlying causes of security threats for Business Corporation. These activities take initiative for risk management process whereby risk analysis renders informed basis. It is for long-term risk for viewing at the management strategies formulation (Weforum.org. 2016).
As far as Economic Co-operation is, concerned, central element of FOCAC of China was renewed interest for expanding FDI in Africa. In other words, China Portfolio of investments involves natural resources extraction, manufacturing as well as construction and industrial processing (Sneyd et al., 2013). This will help Chinese Government in offering tax incentives, credits as well as loans for accessing foreign exchanges especially from enterprise undertaking FDI Projects. On the contrary, China is set for becoming Africa leading foreign investor. In the year 2007, Chinese investors spend more than US $29.2 billion for acquisition of foreign companies. This will rest investors for purchasing US $21.5 billion especially in Chinese companies (Sachs, 2014).
African countries mostly respond towards China new investment capacity with adequate incentives for attracting potential capital. This means China has strengthened this trend in aligning with new investments in Africa (Kyambalesa & Houngnikpo, 2016). For Instance, in the year 2007, China Largest bank owns Industrial and Commercial Bank of China for purchasing 20% stake amounting to US $5.5 billion. On the other hand, these aspects were considered as largest single FDI transactions in and around South Africa history as well as setting stage for increased Chinese FDI flows especially to African continent (Jones, 2015). With increased technology transfers, it deals with skills transfers as well as job creation in accompanying with Foreign Direct Investment. On the contrary, Africa gains opportunity in working towards Chinese capital flows. It requires understanding the key attributes for FDI for gaining Chinese experience relies upon special economic zones on specified tax breaks as well as investment incentives as available by foreign companies (Imf.org. 2016).
FDI to Africa was viewed doubling between 2004 as well as 2007 amounting to US $40 billion based upon driving ways for exploitation of new resources. In other words, long-term prospects for FDI to Africa aim at remaining positive for continued demand of commodities (Confraria & Godinho, 2015). It reveals expanding South-South investment flows in and within China playing important role for promising in African development. Global Financial Crisis enables bringing recent improvements especially for economic growth with greater stability on African continent for developing risk profile. Therefore, it helps in ensuring longer-term growth whereby Africa requires greater economic diversity as well as increased manufacturing for raw beneficiation (Boyle et al., 2014).
Business to business contacts with facilitating by FOCAC in rendering excellent opportunity for Africa in boosting Chinese inward Foreign Direct Investment (Arndt et al., 2016). This process enables new commercial synergies for identifying business process as developed as mutual benefits. Therefore, critical success factor considers for African countries for developing attractive investment environment like China. For longer term, there are various specific as well as practical results governing the FOCAC process revealing in the areas such as trade as well as aid projects in the most appropriate way (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014).
Trade considers under the advanced new Chinese trade zones for established in and around Africa. In this particular scenario, China-Africa establishes ways for facilitating African trade with China as published by African products catalogues for supporting African companies (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014). Joint Chamber of Commerce setting up developing co-operation between business leaders for countries named as China and Africa. In the year 2005, China undertakes more than 700 aided projects in and around Africa. In case of debt cancellation, China cancelled debt amounting to US $1.4 billion as indebted by poor countries in Africa. This means undertaking the further debt cancellation especially for African countries. In case of Loans, China promised providing US $3 billion for preferential loans amounting to $2 billion in exporting credits. It mainly establishes for advancement of trade as well as investment interaction for encouraging new Chinese investment in Africa. China concludes in undertaking more than 65 cultural agreements for training school heads as well as teachers in China for continuing government official training programs. It uses interest allowance for repayment activities in case of infrastructure loans (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014).
Discussion on reports regarding Chinese Investment in Africa will render information on People Republic of China (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014). Investments manifests on people report for relationships from African perspectives. There are various factors for understanding China relationship with Africa on distinctive terms. This enables migration policies on investment as well as infrastructure loans for discussing purpose. In other words, these models of investment help in bringing investment in viewing at the economic growth objectives for bringing together foreign policies in an effective way. This study faces limitations that are conceptual in nature. It is supported with the help of quantitative as well as statistical analysis. Africa assessed depending under macro level especially based on countrywide. Each of the African country are difficult in processing towards evaluating at the time of recession (African Economic Renaissance: The Role of Social Institutions - CASADE. 2014). Financial as well as technical assistance for competitive analysis in resource allocation and construction projects
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Arndt, C., McKay, A., & Tarp, F. (2016). Two Cheers for the African Growth Renaissance (but not Three). Growth and Poverty in Sub-Saharan Africa, 11.
Boyle, P., Halfacree, K. H., & Robinson, V. (2014). Exploring contemporary migration. Routledge.
Confraria, H., & Godinho, M. M. (2015). The impact of African science: a bibliometric analysis. Scientometrics, 102(2), 1241-1268.
Imf.org. (2016). Imf.org. Retrieved 17 October 2016, from https://www.imf.org/external/pubs/ft/reo/2016/afr/eng/pdf/sreo0416.pdf
Jones, C. I. (2015). The facts of economic growth (No. w21142). National Bureau of Economic Research.
Kyambalesa, H., & Houngnikpo, M. C. (2016). Economic integration and development in Africa. Routledge.
Sachs, J. D. (2014). The end of poverty: economic possibilities for our time. Penguin.
Sneyd, L. Q., Legwegoh, A., & Fraser, E. D. (2013). Food riots: Media perspectives on the causes of food protest in Africa. Food security, 5(4), 485-497.
The Keys to an African Economic Renaissance. (2012). The Heritage Foundation. Retrieved 17 October 2016, from https://www.heritage.org/research/reports/2012/05/the-keys-to-an-african-economic-renaissance
Van de Walle, N. (2012). African economies and the politics of permanent crisis, 1979-1999. Cambridge University Press.
Weforum.org. (2016). Weforum.org. Retrieved 17 October 2016, from https://www.weforum.org/agenda/2014/09/top-10-competitive-economies-sub-saharan-africa/