indirect ties such as leasing and distribution agreements. For example, Japanese automobile companies like Toyota, Mazda and Nissan franchise their production to South African manufacturers, who use Japanese-supplied parts and manufacturing technology to build vehicles. Computers, chemicals and electronics have become their new fields of interest in South Africa. 27. Licensing agreements have an additional advantage over other modes of business links with South Africa. They yield royalty and licence pajmients which can be remitted at the higher "commercial rand" rate, while the proceeds of disinvestment have to be deposited in "financial rand" accounts and can be remitted abroad only at the lower "financial rand" exchange rate. Moreover, non-equity arrangements often include supply contracts, and the former parent companies thus have guaranteed export outlets for parts and finished products. The most recent data (1988) on non-equity links by multinationals in South Africa show that 85 of the 207 companies disinvested have retained some form of non-equity ties with South African operations. In the case of United States firms, 47 out of 77 have kept this link; United Kingdom companies have maintained 10 out of 55; Germany (Federal Republic of) firms, 10 out of 17; French firms, 4 out of 11; Canadian firms, 3 out of 13. The products licensed range from computers and electronic equipment to petrochemicals, pharmaceuticals, communications technology and agribusiness products. Thus only a few TNCs are breaking all business ties with South Africa - a situation that is quite contrary to the impression given by statistics on disinvestments. III. SOUTH AFRICAN ECONOMY; SANCTIONS AND REACTIONS A. Structural vLeaknesses of the apartheid economy 28. Structural flaws in the South African economy have long made it dependent on foreign funds to finance economic growth, making it extremely vulnerable to economic sanctions. This heavy dependence on foreign financing stems from the 
**Analysis**
The text primarily discusses the economic relationships between multinational corporations and South Africa, focusing on the forms of business links, such as licensing agreements and leasing, and their implications for the South African economy. The text also touches on the economic sanctions imposed on South Africa and the potential vulnerabilities of the apartheid economy.

**Category**
International trade, Industry