Abstract:
Foreign direct investment (FDI) has been found a very important channel through which international
technology transfer takes place, especially in the context of developed and emerging countries. But very
little is known on transfer of environmentally sound technologies (ESTs) through FDI in the context of
Africa. This policy-science study that brings empirical evidence, conceptual clarity and interdisciplinary
approaches to African policymakers and practitioners deals with this crucial issue. The main aim of this
study is to explore whether FDI can be used to transfer ESTs. It examines the inflow of FDI into Angola s
energy sector and the outflow of direct investments from South Africa s energy sector. It employs a
conceptual framework that links government-imposed regulations and agencies, as well as international
regimes, to govern the flow of FDI. It specifically analyses how two African countries use national
regulations, agencies and international relations to influence FDI for the purposes of the transfer of ESTs.
In the case of Angola, it looks at FDI inflows and the transfer of ESTs into the energy sector; while in the
case of South Africa, the focus is on the transfer of ESTs out of the sector to other African countries, in
particular Uganda.
The study produces two main findings. First, Angola uses its national legal and policy framework and
institutions to regulate FDI flows for the purposes of acquiring ESTs in the energy sector. It specifically
does so through employing structural power to invoke sovereignty principles and implementing these
through particular institutions, as well as effectively interacting with international regimes. Second, South
African does not purposely promote transfer of ESTs through outward FDI to other African countries,
such as Uganda. One of the key conclusions of the study is that host countries (recipients) of FDI can
invoke sovereignty principles enshrined in various national policy and legal frameworks, and deploy
international relations to attract FDI-carrying ESTs. The two key recommendations from this study are as
follows. First, African policymakers and practitioners should shun a reductionist approach to FDI and
start viewing FDI as a multidimensional bundle of resources that can contribute in a multifaceted manner
to sustainable development. Second, further policy-science researches that generate empirical evidence
for African policymakers and practitioners engaged in international negotiations and programmes on FDI
and technology transfer as well as sustainable development should be encouraged.
