Political Analysis For the political situation in South Africa, they face adversity continuously.

As for their ecological and economical status, they rank as the highest nation with biodiversity in the world. Their soil is affected by many factors in their underlying bedrock. Their variety and landforms and vegetations zones have thus resulted in a remarkably high diversity of species (plants and animals alike in South Africa. This results in a rich natural heritage, which includes a mi! of tropical "editerranean and temperate climates. They are thus able to maintain to be one of the si! countries in the world with an entire plant kingdom within its national confines. As for South Africa#s legislation, they face a few boundaries with their mi!ed$hybrid legal system. %t is composed of interweaving a number of distinct legal traditions such as& civil law of the 'utch, common law of the (ritish, and an indigenous law system from African )atives. *ith these traditions having a comple! interrelationship, the procedural aspects of the legal system still prominently prevail to be correlated with the +oman,'utch legal system. 'ue to this, their court system is organized hierarchically, and consists of "agistrates# -ourts, .igh -ourts, a Supreme -ourt of Appeal, and a -onstitutional -ourt. The -onstitutional -ourt had the highest authority in all matters The corruption rate in South Africa has greatly reduced as the government implemented certain laws to reduce the countries corruption level. South African law provides for prosecution of government officials who demands or accepts bribes. /enalties for offering or accepting a bribe may include criminal prosecution, heavy fines, dismissal from the 0ob. There are few agencies and anti1corruption unit such as public service commission, office of the public protector and South African police anti1corruption unit engaged in anti1corruption activities. According to transparency international2s corruption inde! released in 3445 South Africa was ranked 67 out of 894 countries, up from :8st place in 344;. This is a proving evidence to show the decline in corruption rate in South Africa. This would give more confidence to investors who are planning to invest in South Africa in the future as the corruption rate is declining every year at a constant rate. The country is peaceful with respect to democracy and it is known well for the ma0or establishments and other achievements. The country is known for high level of confidence and it also has the key potential to invest with great level of confidence. Thus it is essential to focus on e!ternal as well internal factors for political stability in the country. /olitical stability has increased as the constitutional democracy. (+eportbuyer.com 3483, 56 There is high level of involvement of the foreign investors in South Africa and this helps in international community. The government has also shown talented leadership to the greatest potential and also this gains the business

community. The greater the level of involvement, the greater is the country#s political climate. (<!porthelp.co.za 3483, 48 Economic Analysis South African trade policy is composed due to their composition and aggregate growth of trade. %n the apartheid period, trade protection seriously impeded both e!ports and imports, and the economy depended on favorable global commodity price trends to avoid running into an e!ternal constraint. South Africa developed a comparative advantage in capital,intensive primary and manufactured commodities partly because of its natural resource endowments. .igh and opa=ue tariffs seriously impeded e!port growth, and when global commodity markets were weak, and a declining in gold e!ports, the seriously contained aggregate growth and dulled response to e!ports to the weaker rand in the late 8>94s. 'ue to this, trade liberalization in the 8>>4s not only increased imports but by reducing both input costs and relative profitability of domestic sales, also boosted e!ports. The growth in non,commodity manufactured sectoral e!ports as a result of liberalization was actually faster than sectoral imports. This suggests that additional trade liberalization could well be a part of the strategy to enhance e!port diversification. South Africa#s 'epartment of Trade and %ndustry has launched a -ompetitiveness Fund that provides financial support to =ualifying entrepreneurs, allocating grants that cover up to :4? of their running costs. They also have the (<<, (lack <conomic <mpowerment, which makes sure companies are providing shares to their employees. South Africa has a mi!ed economy with high rate of poverty and low @'/ per capita. (y A) classification South Africa is a middle,income country with an abundant supply of resources, well developed financial, legal, communications, energy, and transport sectors, a stock e!change that ranks among the top twenty in the world, and a modern infrastructure supporting an efficient distribution of goods to ma0or urban centers throughout the entire region. They are ranked 3:th in the world in terms of @'/ as of 3449. Advanced development is significantly localized around four ma0or areas& -ape Town, /ort <lizabeth, 'urban, and /retoria$Bohannesburg. (eyond these four economic centers, development is marginal and poverty is still prevalent despite government efforts. At the start of 3444, then /resident Thabo "beki, vowed to promote economic growth and foreign investment by rela!ing their restrictive labor laws, stepping up the pace of privatization and cutting unneeded government spending. +esults were seen as soon of 3446, when South Africa saw a significant increase in economic growth. Their monetary note, the CA+, is the most actively traded emerging market

currency in the world. The note was the best,performing current against the AS 'ollar for three years, 3443,344:. These markets they trade with, besides other African countries, include @ermany, the Anited States, -hina, Bapan, Anited Dingdom and also Spain. Their chief e!ports include corn, diamonds, fruits, gold, metals and minerals, sugar and wool. "achinery and transportation e=uipment make up more than one,third of the value of South Africa#s imports. Ether imports include chemicals, manufactured good, and petroleum. Ene of their biggest hurdles, which affect South Africa locally, is environmental damage, which was cause by the misuse of the land and global climate change. South Africa is unusually vulnerable to climate change and has seen a vast disappearance of surface waters. South Africa maintains formal trade relations with various countries by means of treaties, trade agreements, and membership in international trade institutions. The centerpiece of South Africa2s foreign economic policy is the Southern African 'evelopment -ommunity (SA'- , comprising Angola, (otswana, the 'emocratic +epublic of -ongo ('+- , Fesotho, "alawi, "auritius, "ozambi=ue, )amibia, Seychelles, South Africa, Tanzania, Cambia, and Cimbabwe. The government2s key policy ob0ective is to strengthen trade and investment linkages between South Africa and the other SA'- countries. The Anited States is another of South Africa2s largest trading partners. South Africa is a beneficiary of the A.S. @eneralized System of /references (@S/ , which grants duty,free treatment for more than 6,;:4 products. South Africa2s e!ports to the Anited States increased from +:.3 billion in 8>>7 to +86.9 billion in 8>>9. South Africa also has important trading relations with Bapan, South Dorea, and countries in South America. According to the global competitiveness report 344:$4;, published by the *orld (ank, South Africa was ranked 63nd out of the 88: countries surveyed in terms of its @rowth -ompetitiveness %nde! (@-% . %n terms of (usiness -ompetitiveness %nde! ((-% rankings south Africa is ranked 39th out 88; countries. %t is one of the highest ranking highest ranking developing economies and surpasses countries such as %ndia, .ungary, %taly aThe budget deficit decreased from >.:? of @'/ to in 8>>7, to 8.:? in 344;. Total public sector debt fell from over ;4? to of @'/ to in 8>>6 to 7:? of @'/ in 344;. The net open forward position of the +eserve (ank improved from ASG3: billion to in 8>>6 to a positive GAS85.3 billion by 344;, the highest level ever.These advances create opportunities for real increases in e!penditure on social services, and reduce the cost and risk for all investors, laying the foundation for increased investment and growth. South Africa also produces the continents 64? of the total output. The reasons mentioned above strongly prove the number of investments operating in South Africa.

-ross borders shoppers are people who come to South Africa for a short period of time to purchase the goods which they need for their business in their home country. The goods they buy from South Africa are generally sold in their home country.

There are about 53? of the cross border shoppers who buy the goods for the purpose of reselling in their home country. The cross border shoppers generally come from the neighboring African countries such as Denya, Cimbabwe, )igeria, Cambia and many more. %n 344: cross border shoppers spent about G83.: billion in South Africa. The great demand for the products made by industries located in South Africa is created by the cross border shoppers. They also largely help in the countries economic growth.

The employment rate in South Africa rate has generally been on an upward trend. The number of 0obs created by the new investments in South Africa is increasing yearly. (etween the period of September 3448 to September 344:, employment increased by over a million. (etween the period of September 3446 to September 344:, ;:9444 new 0obs were created by the new investments in South Africa. There was also a slight improvement in unemployment rate from 3;.5? in September 3446 to 3;.3? in September 344:.

Social Analysis *ith a growing population of 6>,4:3,69> and eleven official languages, South Africa has become and intensely divertive nation. They have a large mass media sector that commonly uses the <nglish language. The South African black ma0ority still has a substantial number of rural inhabitants who lead largely impoverished lives. %t is among these people, however, that cultural traditions survive most stronglyH as blacks have become increasingly urbanized and *esternized, aspects of traditional culture have declined. Arban blacks usually speak <nglish or Afrikaans in addition to their native tongue. There are smaller but still significant groups of speakers of Dhoisan languages who are not included in the eleven official languages, but are one of the eight other officially recognized languages. There are small groups of speakers of endangered languages, most of which are from the Dhoi,San family, that receive no official statusH however, some groups within South Africa are attempting to promote their use and revival.

+esearchers investigating the impact of the current economic crisis on local consumer behavior have found that ;4? of South Africans are worried about the future and their fear is fuelling a considerable change in their buying habits. Ene of the main reasons for investors to choose South Africa to invest is the increase in percentage of the adult literacy rate. Ever the past few years there is a gradual in increase in the literacy rate. %n the year 8>>: the literacy rate was ;>.>? and by 344: the literacy rate has increased to 56.6? in South Africa. And the numbers of the skilled workers are increasingly graduating from the

Aniversities. %n the year 3444 there was >3,98> students graduated from the universities. (ut in the year 344: the numbers of graduates have increased to 836,;5;. Science <ngineering and Technology (S<T graduates are key skilled workers who are critical in supporting economic growth and investment in social infrastructure.

+eal per capita income (average income per person has been rising in South Africa at around 6? annually since 3446. A rise in income in South Africa and the standard of the living of the poor may lead to increased pressure on the environment in other ways, as it may lead to increased demand for the consumer goods. The spending habits of the South Africans will tend to increase when the income increases. The industries will benefit largely as the public are earning more than the previous years and they will tend to buy more =uality goods produced by the South African industries.

South Africans are having a strong sense of national identity, at least in terms of association with the geographic and state entity. South Africa is also rated one of the low risk countries in terms of social instability. This could largely attract the investor confidence to invest in the country as they would not e!pect much protest or riots from workers which are being e!perienced in the neighboring African countries which could affect the running of the business and affects production of the goods.

Technological Analysis There is an intense increase of ecommerce technologies throughout South Africa. Through a survey of 8:4 South African building, it was revealed the

dominance of communication aspects, but not the transaction proves of ecommerce. The integrated implementation of ecommerce solutions and security,enabling applications is incredibly limited. Legal environment The legal system in this country is comprised of three important dimensions such as&1 7.8 +egulatory framework& The domestic laws of the country, the laws of the foreign markets and also the international law This helps the buyers to focus on different aspects in the business in South Africa. These laws also are governed in the market in many respects. This governs the country with marketing aspects and also it relates to high safety, security as well as performance. The rules and regulations create the international process. ((othma 3483, 48 7.3 (usiness laws& South Africa carries laws for competitive policy and it also is creating the world class infrastructure and also it helps in better growth and better network. (Southafrica.info 3483, 8; 7.7 Fabour laws& The employment laws in South Africa helps in ordinary working hours, it provides overtime to the employees, the employees e!tends the ordinary working hours and also there is huge night working hours in the country. There is an availability of public holidays and also every people get leaves on Sundays. (/lacedynamics.co.za 3483, 84 7.6 Ta!ation laws& The ta!ation laws in South Africa deals with the ta! deduction with respect to the employee contributions. This also improves the changes with the benefits and other policies. (<!pat.com 3483, 48 %mport policies in South Africa deter certain type of goods entering into the country. Ander the %mport and <!port -ontrol Act of 8>;7, the "inistry of Trade and %ndustry controls the import of certain goods into South Africa. They are such as petroleum products, ozone depleting chemicals, firearms and ammunition, gambling e=uipment and radioactive chemical elements. (ut over the recent years the list of restricted goods has decreased. The restricted goods do not include iron based and wood based materials which are more commonly re=uired for a home appliances manufacturing industry. As natural resources are limited in South Africa, the industry is re=uired to import raw materials from neighboring countries. (ut this would not cost much as South Africa has signed a free trade agreement known as 2-E"<SA2 (common market for eastern and southern Africa with 34 neighboring African countries and with the <uropean Anion. %t eliminates tariffs on goods imported among one another. So this would help largely in reducing the production cost.

5. S*ET Analysis 5.8 Strengths& South Africa is well known for the industrialized country. %t has the strong governmental policy in its framework. I Adherence to mandate I -ommitment to achievement of mandate I *illingness to confront issues I /rotection of the investors I Fegislation internationally benchmarked I +eputation in the SA'-, as well as regulatory bodies (local, regional and international I Support from "inistry of Finance I <ffective (oard I <ffective senior management and co1operation within the <!ecutive management team I /rofessional staff (graduates with associated behaviour that support transformation I -aring for staff (internal support I <nglish speaking population

5.3 *eakness& %t has low skilled employees and there are shortages of manpower. Thus it also deals with high cost of labour. %t also creates low amount of productivity. I Fack of visible enforcement I /oor response time I Transformation in top management I Attraction and retention of staff with re=uisite skills I Absence of an appropriate retention strategy, including incentive system. I Fength of the legislative process I /ersonal saftey I .%J A%'S I .ighly paid /ublic Sector <mployees I +olling <lectriccty blackouts I 'iscrimination I Anemployment

5.7 Epportunities& There is great opportunity to increase the skills and technology capable labour. I <ffective stakeholder management I <!pansion and strengthening of relationship with government and media Strengthening the collaboration with other relevant regulatory departments and bodies I %ncreasing the interaction and relationship building with representative organisations via %ndustry bodies to strengthen %ndustry perception I -ontinued development of the FS(s role through -%S)A I <nhancement of communication to consumers and regulated entities I <ffective promotion of consumer financial literacy 5.6 Threats& The ma0or threats are the unemployment as well as the poverty in the economy.

I Ancertainty with regard to the direction of regulation in South Africa (Single +egulator I @aps in the regulatory framework of investment schemes I Fitigation against the FS( I Availability and mobility of skills to feed the organisation, especially e=uity candidates