Southern African Development Community :: Oppenness to Foreign Investment

Openness to Foreign Investment

All SADC Member States welcome foreign direct investment (FDI) and claim to provide a liberal FDI regime though there are variations between them with respect to the extent of liberalisation. Though some SADC member states are fully open to foreign investment in many sectors as captured by the Investing Across Borders Report (2010)., there are still have limits on foreign investment in sectors that are considered strategic and of national importance. In particular, foreign investment restrictions are targeted at strategic sectors such as mineral resources, especially oil and gas; transport and telecommunications; banking and insurance; media (both print and electronic); and small scale activities such as personal services. Access to these sectors are governed by affirmative policies and programmes enacted with clear benchmarks on how to economically empower the historically disadvantaged indigenous race (the black people).

Box 2: Some known restrictions of foreign investment by sector

Five SADC countries restrict foreign investment in telecommunications;
Only Mauritius and Zambia permitting 100% foreign ownership in telecommunications;
While Madagascar and Mozambique restrict foreign ownership on fixed line telecommunications sub-sector, they both allow 100% foreign ownership in the mobile sub-sector.
Angola restricts foreign ownership in banking, insurance and transport to 10%, 50% and 80% respectively;
Tanzania has a restriction of 66% in insurance;
Most SADC countries restrict media ownership by foreign investors, especially TV broadcasting;
Only Madagascar and Zambia permit 100% foreign ownership in the media sector.