Developing an investor aftercare model for promotion of the agro-processing sector: the case of Limpopo Province.

Abstract

Investor aftercare is a more often ignored part of investment promotion. This study investigated investor aftercare practices in the Limpopo Province of South Africa. The aim was to establish Limpopo's current investor aftercare practices in relations to promotion of agro-processing in the province. Investor aftercare and agro-processing were reviewed in detail to give context to the study, while a convergent-parallel approach of the mixed method was used in data collection to establish Limpopo's current investor aftercare practices in relations to the promotion of agro-processing in the province, where primary data was collected using a questionnaire and interviews. A review of existing literature was used to supplement and support the primary data. The population in the study included officials from the Limpopo Economic Development Agency, Limpopo Department of Agriculture, the five district municipalities of the province, and the organisation Subtrop as an industry association. A sample of 133 respondents was used, 16 of which provided data through in-depth interviews and 117 through questionnaire responses. The sample participants were selected purposively as key informants who were deemed to have the required information for the study. The interview and questionnaire data were coded, then summarised in terms of frequencies and graphically, and analysed for statistical significance using inferential statistical tests (Chi-square, Pearson’s correlation coefficient) where appropriate. Factor analysis of questionnaire responses regarding perception on investor aftercare gave an indication of the dimensionality of these responses. The results indicated that investor aftercare was not being adequately institutionalised, as several stakeholders in Limpopo seemed to discharge it in a silo approach. This leads to a lack of clarity and worrying overlaps of institutional mandates as far as investor aftercare is concerned. This state of affairs renders investor aftercare less effective. As remedy, a new investor aftercare model, termed the Experiential Investor Aftercare Model, is proposed for the province’s agro-processing sector. The study recommends a review of the institutional arrangement of investor aftercare in Limpopo Province, accompanied by implementation of the proposed investor aftercare model, in order to realise investor aftercare’s potential in promoting Limpopo's agro-processing sector.