{
  "title": "The Composition of Capital Flows: Is South Africa Different?",
  "publication": "IMF Working Papers, March 1, 2005",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/the-composition-of-capital-flows-is-south-africa-different-18005",
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  "summary": "Over the past decade, South Africa has attracted relatively little foreign direct investment (FDI), but considerable amounts of portfolio inflows.",
  "sections": [
    {
      "heading": "Summary and research objective",
      "content": "- Over the past decade, South Africa has attracted relatively little foreign direct investment (FDI), but considerable amounts of portfolio inflows.\n- The paper has two objectives:\n  - To identify the determinants of the level and composition of capital flows to emerging markets.\n  - To draw policy conclusions for South Africa."
    },
    {
      "heading": "Methodology",
      "content": "- Empirical approach: estimate a dynamic panel for up to 81 emerging markets using GMM (Generalized Method of Moments) techniques.\n- Sample coverage: up to 81 emerging markets."
    },
    {
      "heading": "Key findings",
      "content": "- Further trade liberalization would increase the share of FDI.\n- Further capital control liberalization would increase the share of FDI.\n- A reduction in exchange rate volatility would affect the composition of capital flows in favor of FDI."
    },
    {
      "heading": "Policy implications for South Africa",
      "content": "- Policies that further liberalize trade and capital controls are associated with higher FDI shares.\n- Policies that reduce exchange rate volatility can shift capital inflows toward FDI and away from portfolio inflows.\n\n---\n\n Content in this bundle\n\n- wp0540 - References\n  - wp0540 - References (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp0540 - References (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/the-composition-of-capital-flows-is-south-africa-different-18005"
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    "Authors: Norbert Funke, Faisal Ahmed, Rabah Arezki",
    "Published: March 1, 2005",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451860597.001",
    "Over the past decade, South Africa has attracted relatively little foreign direct investment (FDI), but considerable amounts of portfolio inflows.",
    "The paper has two objectives:",
    "Empirical approach: estimate a dynamic panel for up to 81 emerging markets using GMM (Generalized Method of Moments) techniques.",
    "Sample coverage: up to 81 emerging markets.",
    "Further trade liberalization would increase the share of FDI.",
    "Further capital control liberalization would increase the share of FDI.",
    "A reduction in exchange rate volatility would affect the composition of capital flows in favor of FDI.",
    "Policies that further liberalize trade and capital controls are associated with higher FDI shares.",
    "Policies that reduce exchange rate volatility can shift capital inflows toward FDI and away from portfolio inflows.",
    "**_wp0540 - References**"
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