FDI and Trade Policy Openness in Sub-Saharan Africa

Cantah, William Godfred; Brafu-Insaidoo, Gabriel William; Wiafe, Emmanuel Agyapong; Adams, Abass

doi:10.1057/eej.2016.9

Cited by 27 publications

(16 citation statements)

References 49 publications

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“…The impact of trade openness on FDI inflow is expected to be mixed. The majority of empirical studies have found a positive relationship between trade openness and FDI inflows (Makoni 2018;Sahoo 2006;Zaman et al 2018), while some studies have found a negative relationship between trade openness and FDI inflow (Adow and Tahmad 2018;Cantah et al 2018;Khan and Hye 2014). On the other hand, Ho et al (2013) and Wickramarachchi (2019) found that there is no significant impact of trade openness on FDI inflows in BRICS countries.…”

Section: Trade Opennessmentioning

confidence: 99%

“…According to these studies, the positive relationship between trade openness and foreign direct investment indicates that a country with fewer restrictions on imports and exports has a higher chance of attracting foreign direct investment. Secondly, some studies have found a negative relationship between trade openness and FDI inflow (Adow and Tahmad 2018;Cantah et al 2018;Khan and Hye 2014). Thirdly, Ho et al (2013) and Wickramarachchi (2019) found that trade openness had no significant impact on FDI inflows in BRICS (Brasil, Russia, India, China, and South Africa) countries.…”

Section: Introductionmentioning

confidence: 99%

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Causal Links between Trade Openness and Foreign Direct Investment in Romania

Mudiyanselage¹,

Epuran²,

Tescașiu³

2021

JRFM

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In this increasingly globalized era, foreign direct investments are considered to be one of the most important sources of external financing for all countries. This paper investigates the causal relationship between trade openness and foreign direct investment (FDI) inflows in Romania during the period 1997–2019. Throughout this study, Trade Openness is the main independent variable, and Gross Domestic Product (GDP), Real Effective Exchange Rate (EXR), Inflation (INF), and Education (EDU) act as control variables for investigating the relationships between trade openness (TOP) and FDI inflow in Romania. The Auto Regressive Distributed Lag (ARDL) Bounds test procedure was adopted to achieve the above-mentioned objective. Trade openness has negative and statistically significant long-run and short-run relationships with FDI inflows in Romania throughout the period. Trade openness negatively affects the FDI inflow, which suggest that the higher the level of openness is, the less likely it is that FDI will be attracted in the long run. The result of the Granger causality test indicated that Romania has a unidirectional relationship between trade openness and FDI. It also showed that the direction of causality ran from FDI to trade openness.

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Section: Trade Opennessmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Causal Links between Trade Openness and Foreign Direct Investment in Romania

Mudiyanselage¹,

Epuran²,

Tescașiu³

2021

JRFM

View full text Add to dashboard Cite

show abstract

“…While, Globerman and Shapiro 13 , Sekkat and Varoudakis 14 , Busse and Hefeker 15 found positive significant relationship between political stability and FDI, Asiedu 16 , Globerman and Shapiro 17 , Jadhav 18 could not find a statistically significant relationship. 19 , Aseidu and Lien 20 , Cantah et al 21 found positive significant relationship between economic stability and FDI, Asiedu 22 Approach", Journal of management and sustainability, Vol.3, No.4, 2013, pp.151-156. 32 Stein and Daude, Ibid.…”

Section: Empirical Surveymentioning

confidence: 99%

The Role of Governance on Inward Foreign Direct Investment in Developing Countries

Gök¹,

Doğruel²

2016

M U Iktisadi Ve Idari Bilimler Dergisi

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Developing countries generally have poor governance infrastructure negatively affecting investment climate. Since economic growth of host countries is another important factor affecting the foreign direct investment decisions, the aim of the paper is to analyze the effect of governance infrastructure and economic growth with other control variables on FDI inflows in developing countries and to discuss policy implications to increase their FDI inflows. Since governance, FDI and growth are three concepts that interact with each other according to the theoretical and empirical literature, System GMM methodology is used to deal with endogeneity problem. It is found that improvements in governance and higher GDP growth rate attract more FDI inflows in developing countries.Keywords: Governance, FDI, System GMM Analysis. JEL

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“…Energy consumption and financial development positively affect economic growth, but there is no significant relationship between trade openness and economic growth in the long run (Cetin, 2016). Similarly, an openness of the economy can foster FDI in Sub---Saharan Africa (SSA) (Cantah et al, 2018). Trade openness and integration in the world economy positively affect economic growth in both China and India for the last three decades (Marelli and Signorelli, 2011).…”

Section: Empirical Reviewmentioning

confidence: 99%

The Relationship between Trade Openness, Economic Growth, Exchange Rate and Tariff Rate: Evidence from Northeast Asia

Nguyen¹

2019

TR1010

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The article aims to investigate the relationship between trade openness, economic growth, exchange rate and tariff rate in three Northeast Asian countries between 1998 and 2017 using a vector autoregressive model. We found that GDP growth rate has a positive relationship with trade openness. Tariff rate positively affects both GDP growth rate and exchange rate. However, trade openness has a negative effect on exchange rate. We also found that there is a directional relationship running from trade openness to GDP growth rate and exchange rate; and from exchange rate to trade openness and tariff rate. There is a long run relationship among variables. Lastly, policies are recommended to accelerate economic growth and trade openness in Northeast Asia.

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FDI and Trade Policy Openness in Sub-Saharan Africa

Cited by 27 publications

References 49 publications

Causal Links between Trade Openness and Foreign Direct Investment in Romania

Causal Links between Trade Openness and Foreign Direct Investment in Romania

The Role of Governance on Inward Foreign Direct Investment in Developing Countries

The Relationship between Trade Openness, Economic Growth, Exchange Rate and Tariff Rate: Evidence from Northeast Asia

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