Developing investor aftercare model for promotion of Agroprocessing sector: The case of Limpopo Province

Abstract

A noteworthy effect of prolonged global economic crisis has been that investors have become more risk averse in their investment decisions. As companies get to grips with a difficult economic climate brought by Covid-19,global investment patterns reveal that more companies go for less costly substitutes to greenfield investments when seeking to grow their businesses. As a result, investor aftercare is perceived to be a less costly and risky strategy even though is more often ignored part of investment promotion. Locations that ignore aftercare miss out on the positive externalities investors bring to their locations. This study aimed to understand Limpopo's current investor aftercare practices to develop a model that would encourage much needed investment into the province’s agro-processing sector. Investor aftercare and agro-processing were reviewed in detail in order to give context to the study, while a convergent-parallel approach of the mixed method was used in data collection to understand Limpopo' s current strategy in relations to promotion of agroprocessing in the province, where primary data was collected using a questionnaire and interviews, supplemented by usage of student papers and credible internet sources. The population in this study included the officials from Limpopo Economic Development Agency, Limpopo Department of Agriculture, Limpopo five district municipalities, and Subtrop as an industry association. A total sample of 133 participated in the study. The study concludes that investor aftercare is not being adequately institutionalized as several stakeholders in Limpopo seem to discharge this function in a silo approach. This leads to a lack of clarity and worrying overlaps of institutional mandates which renders investor aftercare less effective. The study recommends the review of the institutional arrangement of investor aftercare in Limpopo province, accompanied by the researcher’s newly developed model called experiential investor aftercare, which is likely to realise the potential investor aftercare has in promoting Limpopo's agro-processing sector.

Keywords: Agro-processing; investor aftercare; promotion