Browsing by Author "Lanhove, Tom"

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    Assessing the political and investment risk climate of the PRC : a SAB-Miller case study
    (Stellenbosch : Stellenbosch University, 2004-03) Lanhove, Tom; Brink, Charlotte; Stellenbosch University. Faculty of Arts & Social Sciences. Dept. of Political Science.
    ENGLISH ABSTRACT: This research assignment has investigated the overall nature of the investment climate in the People's Republic of China (PRC).The investment climate was analysed using a Political Risk Analysis (PRA) framework, whereby the PRC was scrutinised closely for its most defining socioeconomic features and, especially, for its most salient political risk factors. Based on this, the assignment evaluated this climate with specific relevance to the investment plans of the South African company SAB-Miller. Since its accession to the World Trade Organisation (WTO)in 2001, the PRC has intensified its economic restructuring process, a necessary and inevitable process, in order to comply with the terms of the WTOframework. This period of adjustment has heightened the anxiety over the strength of the Chinese economy, and the repercussions and/or opportunities for the multinational SAB-Miller.To remedy this uncertainty, this assignment has drawn up an in-depth qualitative scenario, in order to forecast the major trends of the PRC's short-term socio-political future. The main findings of the assignment indicate that a 'high-road' scenario is the most likely to occur in the PRC in the short-term. Clearly, this favourable forecast 1S dependent on the continuation of the current economic and socio-political restructuring process in the PRC. With regards to the main macro-political risks factors, the assignment draws attention to several critical areas of concern. Firstly, the lack of legitimatisation from the 'bottom-up' is a worrying feature, especially in light of the growing economic disparities between citizens and between provinces. Secondly, the financial and governmental sectors need a thorough restructuring, according to WTO criteria. Thirdly, the fragmentation of the market inside the PRe undermines the potential of the PRC government to diffuse the benefits of economic growth and to absorb the downsides of globalisation. Micro-specific risk factors for the company SAB-Miller are focussed predominantly on the speed and the depth of the implementation of the guidelines of the WTO. Especially with regards to the lowering of intra-provincial trade barriers and the efficacy of the distribution networks. Lastly, SAB-Miller should eliminate any risk factors, which may originate from inside the company's behaviour, such as the effects of its adopted labour policies. Lastly, it should maintain a clear level of transparency in their associations with governmental institutions. Throughout the assignment, these risk factors will be investigated and related to the overall political risk climate and utilised to draw conclusions concerning the potential of the investment plans of SAB-Miller.