1. No category

Foreign Direct Investment in MOZAMBIQUE & UGANDA
Lecture Supplement
Econ 490s: African Economic
Development
Daniel Siliski
Emory University
March, 2008
[email protected]
Note on sources: All facts, statistics and text drawn from data in
The Economist Intelligence Unit Country Profile 2008, unless
otherwise noted. All images are modified or taken from the
internet and are public and unrestricted for reproduction to the
best of my knowledge, unless otherwise noted.
1
TABLE OF CONTENTS
Contents
…
2
Definition: FDI
…
3
Maps
…
4
MOZAMBIQUE
Economy
Oil & Resources
Capital Markets
FDI
Trading Partners
Current Accounts
Balance of Payments
Exports
…
…
…
…
…
…
…
…
…
5
5
8
10
11
12
13
14
15
TFP
…
16
Concept: Total Factor Productivity
UGANDA
History
Landlocked!
Economy
Trade
FDI
Balance of Payments
…
…
…
…
…
…
…
17
17
20
21
23
24
25
2
Table of Contents
DEFINITION:
Foreign Direct Investment
UNITED NATIONS
“Investment made to acquire lasting interest in entrerprises
operating outside of the economy of the investor.” –Foreign
Direct Investment, www.unctad.org
(CENTRAL) BANK OF UGANDA
“According to the Bank, FDI reflects the objective of a
lasting interest by a resident entity in one economy
(direct investor) in an entity resident in another
economy (the direct entity).” –FDI Country Profiles,
www.unctad.org
BANCO DE MOCAMBIQUE
->Goto Mozambique Central Bank
“In Mozambique, foreign direct investment (FDI) is
defined as any form of foreign capital contribution,
valuables in monetary terms which constututes own
equity capital or resources at the own account and
risk of foreign investor, brought from external
sourves and to be used in an invesment project for
carrying out an economic activity, through a company
registered in Mozambique and operating in
Mozambican territory (Law of Investment – Law N0
3/93).” –FDI Country Profiles, www.unctad.org
Table of Contents
3
UGANDA
Table of Contents
MOZAMBIQUE
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Image: Mozambique in red; neighbors Tanzania, Malawi,
Zambia and Zimbabwe in blue; primary trading partner in
green, South Africa.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Image Source: http://www.mozambiquetravelservice.com/diving/
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Image Source: unimaps.com/flags-africa/mozambique-flag.gif
Image Source: aes.iupui.edu
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Google Earth public images. Villiage in northern costal state.
Goto: Compare Ugandan huts.
Image: Frelimo (Frente Popular para a Liberatacao de Mocambique)
flag (1983-2007). Frelimo is a political party responsible for
Mozambique’s independence from Portugal in 1975, ruling through
2008. Source: Wikipedia.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
View over Maputo, with Catedral de Nossa Senhora da Conceicao in
foreground © Photographer: Paul Bernhardt. Lonely Planet Images.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Sao Lourenco Fort, built by Portuguese in 1695, sitting on Sao Lourenco
Island© Photographer: Ariadne Van Zandbergen. Lonely Planet Images.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Image: Zambezi River Delta. Source: Google Earth.
Goto: Uganda’s Trading Partners
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Goto: Uganda’s Current Account
Ferry from small town of Catembe docking at Maputo Harbour
© Photographer: Rick Gerharter. All images Lonely Planet Images.
Goto: Compare Uganda’s Transportation Obstacles @ “LANDLOCKED!!”
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Goto: Uganda’s Balance of Payments
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
MOZAMBIQUE
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
TFP:
TOTAL
FACTOR
PRODUCTIVITY
Sometimes, African workers are
productive enough to compete
in global markets, but some
non-worker inputs have such
low productivity that firms are
overall unproductive and
uncompetitive.
In this case, African firms have
access to strong worker
productivity, but suffer from
low total factor productivity.
Poor infrastructure, expensive
transportation, bureaucratic red
tape and lack of access to
credit can hurt TFP.
Table of Contents
16
UGANDA
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
•Prior British colony
•EAC, EAC Treaty of 1999. Integrated
trading partners with Kenya and
Tanzania.
•No major military conflict, but tense
neighboorhood with Sudan, Rwanda,
Kenya, DRC.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
Image: Uganda in red;
neighbors Tanzania, DRC,
Sudan and Rwanda in blue;
primary trading partner in
green, Kenya.
LANDLOCKED!
•Because of lack of roads, most
of Uganda’s trade is routed
through Kenya, with distant
access to the Indian Ocean.
Conflict with Kenya causing
closed borders is a threat.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
Goto: Compare Mozambique’s Modern Transportation and Shipping
UGANDA
Land Tenure
“Customary Tenure” – no right of
ownership
Progress towards better ownership
laws and documentation
Image: Tutsi Dancers. Photograph by George F. Mobley.
Farming:
80% of workforce
30% of GDP
42% of farming from informal sector
65% Food Crops
Coffee is 18% of total exports
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
Natural Resources:
Mineral potential largely undeveloped
Canadian company, “Uganda Gold Mining,” and other FDI in
mining
Gold is 3rd largest export after coffee and fish
Manufacturing:
Very low productivity, low investment
Mostly food processing
Image (right): “Above Kapchorwa, site visit.” Hess,
Charlotte. IRFI Deforestation.
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
TRADE
Imports: Dominated by oil and manufactured goods.
Exports: Agricultural goods
Large trade deficit
Large growth in regional trade
Regional trade: EAC, COMESA
Goto: Mozambique’s Current Account
Image source: www.DismalWorld.com
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
FDI
Aside from new debt, the other prime source of financing for
the persistent current-account deficit is inflows of foreign
direct investment (FDI). Not only has Uganda’s IMFsponsored economic reform programme resulted in greater
donor assistance, but the resulting economic stability has
attracted significant levels of FDI. According to the most
recent data available from the UN Conference on Trade and
Development, Uganda received FDI inflows of US$357m in
2005, continuing the gradual increase of recent years.
Image source: ittp.org/photos/uganda
Goto: Compare Mozambique huts.
Goto: Mozambique’s Trading Partners
Table of Contents
Source: Economist Intelligence Unit Country Reports, 2008.
UGANDA
Table of Contents
Goto: Mozambique’s Balance of Payments
Source: Economist Intelligence Unit Country Reports, 2008.
Foreign Direct Investment in MOZAMBIQUE & UGANDA
THE END
Thank You Very Much
Daniel Siliski
Emory University
March, 2008
[email protected]
Note on sources: All facts, statistics and text drawn from data in
The Economist Intelligence Unit Country Profile 2008, unless
otherwise noted. All images are modified or taken from the
internet and are public and unrestricted for reproduction to the
best of my knowledge, unless otherwise noted.
26