OUR SERVICES
Macroeconomic Impact Analysis
Macroeconomic Impact Studies are typically undertaken for large companies who want a better understanding of the overall contribution that the company makes to the economy. This can be purely for public relations purposes or it can be to help engage with stakeholders. Macroeconomic analysis quantifies the direct, indirect and induced expenditure taking the interrelated links of government, business and households into account and is usually quantified as contribution to Gross Domestic Product (GDP), direct and indirect jobs, contribution to taxes and household income.
Cost Benefit Analysis
Cost Benefit Analysis (CBA) is important because this analysis determines whether a project is economically efficient. All the costs and benefits over the life span of the project need to be quantified, converted to economic costs through shadow pricing and discounted to present day values using an appropriate social discount rate.
If the sum of the discounted benefits outweighs the sum of the discounted costs then the project is deemed to be economically efficient. The outcome of the analysis is the reporting of a benefit cost ratio (BCR), the project net present value (NPV) and economic internal rate of return (EIRR).
Microeconomic Analysis
Microeconomic Analysis examines the impact of a project on specific sectors of society. While a project might generally be beneficial to society there would invariably be parties that stand to gain or lose more than others. The objective of a microeconomic analysis is to identify these parties and to suggest appropriate mitigation measures if necessary.
Productivity Analysis
The essential requirement for a country to grow and prosper is that it becomes more productive and, as a result, more competitive. StratEcon has been involved in numerous projects that have attempted to make companies, sectors, provinces and government departments more competitive. This could be through reduced travel times, improved communication, access to the internet, a healthier workforce or the clustering of businesses to create synergies within industries.
Gambling Market Assessments
Entering a gambling market, particularly for casino operators, is a high risk business. The up-front capital expenditure can be very high and the casino needs to be configured to the correct size for the market. Too small and there would be overcrowding. Worse from an operator perspective is for the casino to be too large. This poses both the threat of bankruptcy, on the one hand, and reduces the casino experience of the punter. Casino operators need to ensure that a proposed casino is the right size for the market while Gaming Authorities need to ensure that additional casinos do not lead to oversaturation.
Environmental Impact Assessments
In many cases environmental impact assessments (EIAs) require an economic specialist study. Members of Stratecon have undertaken a number of such specialist studies. The approach is dictated by both international best practise based on Equator Principles, International Finance Corporation (IFC) standards and the European Investment Bank guidelines. The approach also follows the South African guide on specialist economic studies.
Legal Assessments & Due Diligence
Analysis of an industry/ project may require an assessment of applicable law, legal requirements, licensing, permits, court cases, company status, contracts and contractual relationships. Either as a stand-alone assessment or as part of a wider economic analysis, we conduct legal research and assessments based on investigation of the law/legal aspects relating to the project.
In most cases, legal research adds particular value to risk and compliance while contributing to an overall understanding of industry or role player conditions. We answer questions such as: what is being done, what is allowed, what needs to be done, where is non-compliance, what is required to enter an industry and where are the pitfalls?
Due diligence and the research it entails allows for a better understanding of the target business, industry or jurisdiction. This leads to more effective decision making, risk management and project planning.
Multi-Criteria Decision Analysis
Multi-Criteria Decision Analysis (MCDA) is used when projects have conflicting effects and decision-makers need to choose the optimal outcome within a specified policy framework. What might be good socially or economically might not necessarily be good for the environment. Tax generation could come at the cost of job creation.
StratEcon has extensive experience in setting up MCDA matrices, assisting officials in weighing the criteria according to policy imperatives and scoring the individual options. Sensitivity analyses are performed to assess the robustness of the overall outcomes and to highlight the consequences of the various policy choices.