Cite as https://mymun.com/ppdb/18681
Delegate: Maximilian Dimitrov, German School Sofia
Topic: National Sovereignty and Foreign Direct Investments in Africa
Foreign investments in African countries hold great significance for both ethical and economic reasons. Foreign direct investment in Africa that is aimed at bettering the standard of life as well as foreign investment that utilizes the economic benefits that the African market has are both important forms of investment and boost the economic growth of African countries, which inevitably has a positive effect on the quality of life in set countries.
The Kingdom of Sweden firmly believes that foreign investment if Africa can be beneficial for all involved parties. Yet some problems arise with the national sovereignty of the countries receiving the investments.
By taking in more and more financial support, countries fall into a vicious cycle of unsustainable debt. In order to break free from set vicious cycle, the country gives up political or economic assets as a form of debt repayment. This process threatens the countries` national sovereignty and has a negative effect on its development, both in the humanitarian and economic sectors.
Another problem that arises is the easily exploitable African labor market. It is generally beneficial for African countries to attract companies. At the same time, it has been cheap for companies to establish their main production centers in Africa, especially in the past few years. Therefore, an ever - increasing number of foreign firms have been locating to the African continent. Due to the lack of options for the Afri...