Foreign Direct Investment in the West African Region: Analyses on the Values of Inflow and Outflow

Yeboah Evans; Yu Jing

doi:10.30560/rfm.v2n1p15

Yeboah Evans School of Economics and Management, Nanjing University of Science and Technology, China
Yu Jing Nanjing University of Science and Technology, China

DOI: https://doi.org/10.30560/rfm.v2n1p15

Keywords: FDI, ECOWAS, inflow, outflow, economy

Abstract

With regards to the ongoing development in investment activities in the Economic Community of West African States(ECOWAS) and the entire African continent is because of institutional reforms and initiation of sound investment policies. Foreign direct investment(FDI) inflow and outflow severs as a source of capital formation for most developing and least developed countries. This paper provides an overview and analyses of the flow of FDI to the ECOWAS region by considering 16 nations under this region in determining their performance towards FDI attraction and their contribution to outward FDI across the globe by the use of the quantitative method. The outcome shows that there is a continuous decline in FDI inflow to the ECOWAS region over the past 10 years. The result also proves that Ghana and Nigeria are the major recipients of foreign direct investment inflows in the West African region. The result further indicates that Nigeria is the major contributor of outward FDI from the ECOWAS region. It is recommended that the region should increase its outward FDI.

References

Abel, E. E., & Nicolette, C. (2012). FDI Flows to Sub-Saharan Africa: The Impact of Finance, Institutions, and Natural Resource Endowment. Comparative Economic Studies, 54, 597-632. https://doi.org/10.1057/ces.2012.18
Bruce, Z. (1978). The Economic Community of West African States (ECOWAS): An Analysis and Prospects. Case Western Reserve Journal of International Law, 10(1).
Dvelopment, U. N. (2018). Regional Integration and Non-Tariff Measures in the Economic Community of West African States (ECOWAS). UNCTAD.
GSS. (2019). Rebased 2013-2018 Annual Gross Domestic Product. Accra: Ghana Statistical Service.
Hezron, M., & Pauline, W. (2016). Role of foreign direct investment on technology transfer and economic growth in Kenya: a case of the energy secto. Journal of Innovation and Entrepreneurship, 5(31). https://doi.org/10.1186/s13731-016-0059-3
Hussaini, S. (2018). THE IMPACT OF FOREIGN DIRECT INVESTMENT ON ECONOMIC GROWTH OF WEST AFRICAN MEMBER STATE’S (A CASE STUDY OF ECOWAS) (2001 - 2015). International Journal of Business and Management Review, 6(11), 24-39.
IMF. (2012). World Economic Outlook: Growth Resuming, Dangers Remain. Washington DC: International Monetary Fund.
John, C., & Nadege, D. (2015). What Drives Foreign Direct Investments into West Africa? An Empirical Investigation. African Development Review, 27(3), 199-215. https://doi.org/10.1111/1467-8268.12141
Laleye, N. A., & Akinleye, S. O. (2018). Major Determinants of Foreign Direct Investment in the West African Economic and Monetary Region. Iran Economic Review, 22(1), 121-162.
Moses, M. S., & Godbertha, K. (2012). Determinants of Foreign Direct Investment in Africa: A Panel Data Analysis. Global Journal of Management and Business Research, 12(18).
Olawumi, D., Olufemi, P., & Theuns, G. (2017). Foreign direct investment and economic growth in Africa: a comparative analysis. Int.J.Sustainable Economy, 9(3), 183. https://doi.org/10.1504/IJSE.2017.085062
Prince, J., & Vijay, S. (2019). The Determinants of FDI in Sub-Saharan Economies: A Study of Data from 1990–2017. International Journal of Financial Studies .
Service, G. S. (2019). Newsletter Quarterly Gross Domestic Product (QGDP) Second Quarter 2019. Accra: GSS.
UNCTAD. (2010). Investing in Low-Carbon Economy. United Nations Conference on Trade and Development, 184.
Unctad. (2015). World Investment Report:Reforming International Investment Governance. New York and Geneva: United Nations Conference on Trade and Development.