Thesis On Foreign Direct Investment In Ghana

Thesis On Foreign Direct Investment In Ghana-84
Finally, their obligations to credit nations compromise the ability of these governments to act independently in the international political economy.A number of domestic factors are important in attracting FDI to an economy.

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The study found that both the long-run and short-run results found statistically significant negative effects of inflation rate, exchange rate and interest rate on FDI in Ghana whiles gross domestic product, electricity production and TU had a positive effect on FDI. Download as . The full terms of this licence may be seen at Foreign direct investment (FDI) is a vital ingredient in achieving sustained growth of any nation, including Ghana.

This study has given more effective ways of attracting more FDI into countries which in effect achieve higher GDP and also higher standard of living through mechanisms and in the end creating more social protection programs for the people. FDI serves as a critical factor that helps to propel the economic growth of every nation (Coy and Comican, 2014).

For example, from 1980–1989 to 1990–1998, FDI to Sub-Saharan Africa (SSA) grew by 59 percent.

This compares disproportionately with high increase of 5,200 percent for Europe and Central Asia, 942 percent for East Asia and Pacific, 740 percent for South Asia, 455 percent for Latin America and Caribbean and 672 percent for all developing countries.

Second, most African countries realize that debt service is a burden in their attempt to mobilize capital for domestic development projects.

Third, excessive debt service burdens severely constrain the capacity of African Governments to provide quality social services (such as health, education and infrastructures) for the citizenry.The factors that determine foreign direct investment (FDI) are important to policy-makers, investors, the banking industry and the public at large.FDI in Ghana has received increased attention in recent times because its relevance in the Ghanaian economy is too critical to gloss over.The purpose of this paper is to examine the determinants of FDI in Ghana between the period of 19.The study found a cointegrating relationship between FDI and its determinants.The study recommended that government must create the enabling socio-economic and political environment with appealing features for FDI.Also, government must showcase the investment potentials of the country to the world through the various technological mediums and Ghana Investment Promotion Center (GIPC) and the Free Zones Board (FZB) are laudable initiatives by government towards attracting FDI.Although studies have been conducted to explore the determinants of FDI, some of the core macroeconomic variables such as inflation, interest rate, telephone subscriptions, electricity production, etc., which are unstable and have longstanding effects on FDI have not been much explored to a give a clear picture of the relationships. (2019), "Analysis of the determinants of foreign direct investment in Ghana", Journal of Asian Business and Economic Studies, Vol. FDI is essentially an international investment where the investor gains significant influence in the management of an entity outside the investor’s home country (Solomon, 2011).Therefore, a study that will explore these and other macroeconomic variables to give clear picture of their relationships and suggest some of the possible ways of dealing with these variables in order to attract more FDI for the country to achieve its goal is what this paper seeks to do. FDI under all circumstances has become an important force in the internationalization of investment activities in the global economy.This is good news, especially, for the countries that do not have access to international capital markets.However, Africa did not benefit from the FDI boom despite its efforts to attract FDI inflows.


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