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The Financial and Economic Environment of a US website business targeting South African students - Essay Example
Finance & Accounting
Pages 16 (4016 words)
This project includes an analysis of a new business opportunity in South Africa based on the financial and economic environment and trade relations of US-South Africa. The popularity of US educational system opens doors for many business opportunities such as online educational counseling services for foreign students. …
The paper tells that South Africa has a well-developed financial and legal environment with its stock exchange the world’s 18th largest exchange, ranked 17th with market value $1.013 trillion in 2010. It is one the most advanced developing countries on African continent. It is a middle-income economy with abundant natural resources. The country’s former fiscal policy was conservative mainly focused on controlling inflation and reducing budget deficit. The policies still exist but the recent global recession has put pressure to provide with the basic services to poorer sections and provide for employment guarantees. The unemployment stands at 25% which is high as compared to other economies such as US and UK which are at 107 and 87 respectively. In 2000 population below poverty lines was 50%. South Africa is ranked 30th in terms of Foreign Direct investment at home. South Africa’s main trading partners include China, Germany US, Japan and UK. The country was the host for 2010 FIFA World Cup which boosted its business revenues and infrastructure. USA is the market-oriented economy with the most advanced technology. In many previous years the country has been the net importer of the goods and services being the number 1 importer in the world and ranked 4th in exports. Its population below poverty line stands at 15.1% and unemployment rate at 9.6% in 2010. The country is also the largest consumer of oil. The US and South Africa signed a $120 million investment fund protocol under OPIC (Overseas Private Investment Corporation) in 1996 for equity investments in South Africa. ...