Tag Archives: FDI

Economic Implications of Environmental Degradation in Nigeria: Is the Environmental Kuznets Curve Relevant to Nigeria (Published)

Challenges of environmental degradation have been an impediment to the level of economic progress in Nigeria. The major objective of the paper is to establish the economic consequence of environmental degradation drawing from the Environmental Kuznets Curve (EKC) framework. The research covered the period between 1986 and 2017. The Ordinary Least Squares and Granger Causality were used to analyze the data. The result indicates that per capita income has a positive and insignificant relationship with carbon emission. An indication of the absence of the EKC. The square of the per capita income has a positive and insignificant relationship with carbon emission. A further confirmation of the absence of the EKC in Nigeria. Population has a significant and positive impact on the level of carbon emission. Openness and FDI have positive and significant impact on carbon emission. The result of the granger causality test indicates no causal relationship between carbon emission and per capita income. Increase in per capita income that is not followed by a rise in inflation rate as well as strong regulatory measures are recommended.

Keywords: EKC, FDI, Per Capita Income, Population, carbon emission, trade openness Ordinary Least Squares

The Impact Of Foreign Direct Investment on Economic Growth of West African Member State’s (A Case Study Of Ecowas) (2001 – 2015) (Published)

Economic Community of West African States (ECOWAS) has been programmed to fuel economic growth of all its member nations not only through trade liberalization and common customs union but through attracting FDI inflow as well. Since its inception, it has been undergoing a series of institutional reforms to achieve its stated objectives. Against this background, this research investigates the relationship between foreign direct investment and economic growth in the Economic Community of West African States (ECOWAS). This study shall use panel data spanning 2001 to 2015. In order to achieve this, the study shall conduct empirical analyses by panel unit root, heterogeneous panel co-integration, and SUR multiple regression. Research findings from Pedroni co-integration test show that there is a cognate relationship between all the factors under investigation concerning ECOWAS region. Co-integration analysis also indicates a positive and significant relationship between variables such as financial development, FDI, domestic trade, and trade openness, while unemployment and social unrest negatively relates to economic growth, though unemployment is not statistically significant. For the sake of caution, this study uses a SUR multiple regression for the robustness test. Empirical result shows FDI strongly relates to economic growth in ECOWAS nation. The results are in consonance with the previous theories on growth-FDI modeling. The research findings suggest that ECOWAS members should provide a conducive and enabling environment to attract a free flow of FDI into their economy.

Keywords: Ecowas, FDI, Heterogeneous panel cointegration, SUR Multiple Regression., economic growth

The Assessment of Kurdistan Region’s Investment Law and Its Impacts on Foreign Direct Investment (Published)

The Kurdistan Region’s investment Law. No. (6) of 2006 was a great move by the government to attract foreign companies to invest their money in Kurdistan Region. Therefore, the side effects of investment law in Kurdistan is controversial. This study aimed to investigate the impacts of Investment Law on FDI in Kurdistan. It also intended to assess the importance of this law in developing different economic sector of the Region. The qualitative data was collected through face to face interview with experts and law professionals. The findings indicated that the Law becomes an important tool to attract foreign companies in the first place and hundreds of projects has been implemented which was difficult to be done without such laws. However, the study identified negative impacts of this law in the future. The law was found to be very less advantageous for the local populations and the government comparing to investors. The law has provided several incentives to the investors which might even pose national security issue in the future as investors are given loans and lands to make projects. The law has to be revised and amended as the KRG has already passed the first stage of investment and now needs mega projects and more benefits.

Keywords: Business Law, FDI, Investment Law, Kurdistan Region, Regulations.

Business Environment and the Growth of Foreign Direct Investments in the Information and Communication Technology Sector in Rwanda in 2012 – 2013 (Published)

This research work was carried out to examine the extent to which improved business environment contributed to the growth of Foreign Direct Investments in the Information and Communication Technology sector in Rwanda in 2012-2013. Rwanda continues to undertake reforms towards making the country a favorable place for investment. On the 2014 World Bank “Doing Business” report, the country was ranked as the 2nd most improved in the world and the second easiest place to do business in Africa. In 2012, Foreign Private Capital inflows to Rwanda increased by 14.8 percent to $ 409.3 million compared to $356.6 million recorded in 2011. The capital inflows were dominated by Foreign Direct Investments, amounting to $ 255.0 million, and accounting for 62.3 percent of total inflows. The Information and Communication Technology sector attracted the highest flows (41.2%). The study established that, the improved business environment moderately influenced (Pearson correlation coefficient of 0.537and significance -2 tailed- of 0.35), the attraction of Foreign Direct Investments to the Information and Communication Technology sector in Rwanda in 2012-2013. Regulations which improved the ease of establishing business operations, security, growth and sustainability of investments had the highest influence on foreign investors in choosing Rwanda as their investment destination. These covered the areas of good governance, good macro-environmental factors, investor protection, ease of getting credit, ease of starting a business and enforcement of contracts ranked among the top six influencers, in that order, by over 91% of the foreign investors. Insolvency resolution was found to be of great importance particularly to the large foreign investors (above Rwf 75 million in equity investments and turnover above Rwf 50 million as per the World Bank 2014 report) who required a clear exit plan. 50% of these investors ranked the indicator in the upper quartile of the most influential variables. Untapped business opportunities attracted three large multi-nationals to the Information and Communication Technology sector and contributed to the impressive growth of Foreign Direct Investments registered in the Information and Communication technology sector. Publicity by the World Bank Doing Business report, of the impressive transformation and commitment to lower the cost of doing business that was demonstrated by Rwanda, was found to have created considerable interest among 40% of the foreign investors selected. The study adopted a cross-sectional survey and descriptive research design and both secondary data and primary data were utilized. Questionnaires were administered accompanied by interviews to obtain accurate information from the selected sample. Statistical Package for Social Sciences (SPSS) was used for correlation analysis while Microsoft Excel was used for the listing, ranking and analysis of variables. The tools of summarization of data were statistical tables, histograms, line charts and bar charts. For the qualitative data, simple listing of suggestions, factors and other itemized variables was adopted. Pearson correlation was used to study the relationship between the business environment and the level of Foreign Direct Investments registered.

Keywords: Business Environment, FDI, ICT, Rwanda

INTERACTION AMONG EDUCATION, EMPLOYMENT, FDI AND GDP GROWTH IN BANGLADESH- AN ECONOMETRIC ANALYSIS (Published)

This paper has addressed a very important policy question of Bangladesh. This examines the causality among education, employment, FDI and GDP growth in Bangladesh by using time series data from 1980 to 2013. Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) unit root tests show that the time series data is stationary at first difference. Then, the Johansen cointegration analysis indicates that the variables have strong, positive and significant linear relationship between them at .05 level of significance. Granger causality test found the unidirectional causality between employment and literacy rate and also between literacy rate and FDI. Again this empirical Granger causality test found that employment and FDI Granger causes GDP in unidirectional way. Finally, the Vector Error Correction Model (VECM) is also used to check the short and long run equilibrium relationships among the variables and the significant results have been found. This study gives the guideline to the researchers and policy makers.

Keywords: Bangladesh, Education, Employment, FDI, GDP growth

INTERACTION AMONG EDUCATION, EMPLOYMENT, FDI AND GDP GROWTH IN BANGLADESH: AN ECONOMETRIC ANALYSIS (Published)

This paper has addressed a very important policy question of Bangladesh. This examines the causality among education, employment, FDI and GDP growth in Bangladesh by using time series data from 1980 to 2013. Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) unit root tests show that the time series data is stationary at first difference. Then, the Johansen cointegration analysis indicates that the variables have strong, positive and significant linear relationship between them at .05 level of significance. Granger causality test found the unidirectional causality between employment and literacy rate and also between literacy rate and FDI. Again this empirical Granger causality test found that employment and FDI Granger causes GDP in unidirectional way. Finally, the Vector Error Correction Model (VECM) is also used to check the short and long run equilibrium relationships among the variables and the significant results have been found. This study gives the guideline to the researchers and policy makers.

Keywords: Bangladesh, Education, Employment, FDI, GDP growth

IMPACT OF FOREIGN DEBT ON ECONOMIC GROWTH IN BANGLADESH: AN ECONOMETRICS ANALYSIS (Published)

This paper tried to investigate the impact of foreign debt on growth in Bangladesh. The annual data series over the period 1972-2010 has been used. The study has been made by using the ARDL (Auto- Regressive Distributive Lag model) model to check the relationship of growth and debt. According findings there is a significant adverse effect of debt on growth in Bangladesh. In Bangladesh External debt service is a burden for its nation and it makes the GDP slows down. This study recommended that Bangladesh should find out any option of debt cancellation and must increase human development and more infrastructure development. It is also recommended that debt management should be effective and fair, and Exports, FDI and Remittances are helpful for the growth of Bangladesh.

Keywords: ARDL, Export, FDI, Remittance, cointegration test and unit Root, foreign debt

EQUITY AND EXCELLENCE A NOVEL EXPERIMENT FOR CONVERGENCE- KISS ODISHA (Published)

India has achieved significant increase in enrolment to higher education over the last decade. However, there is serious dissonance in terms of relative access by different sections of its population. There is a valid perception that discriminatory practices often impinge compromise on quality. This paper argues that it is possible to ensure excellence while providing improved access to students from SC/ST through a policy of reservation. The paper brings out a unique experiment in Kalinga Institute of Social Sciences (KISS), Odisha where there is remarkable convergence between all-round excellence through empathetic intervention. Concrete measures like vibrant Public Private Partnership (PPP), increased allocation, inflow of Foreign Direct Investment (FDI) by collaborating with reputed foreign universities and use of ICT and Open Distance Learning (ODL) & above all a more sensitive regulatory agency can be powerful recipes for achieving the goals of higher inclusive growth, Improved Human Development Index (HDI) and higher Gross Enrolment Ratio (GER) (25%) in higher education.

Keywords: Affirmative Action, FDI, GER, HDI, ICT, KISS Odisha, ODL

ROLE OF POLICIES IN ECONOMIC GROWTH: A CASE STUDY OF CHINA’S ECONOMIC GROWTH (Published)

It is historical fact the economic policies play key role in the growth and downfall of different empires whether it was Muslim empires in Spain and India or British Empire, which ruled almost the whole world in 17th and 18th centuries. The emergence of China’s economic growth is the phenomena of 21st century. The author has intended to investigate the Chinese policies in different sectors as the drivers of economic growth during the period 1980-2010.The main objective of this research is to investigate different policies introduced by the Chinese government during 1980-2010 to promote economic growth and to measure their effect at micro and macro level of Chinese economy.The author used secondary date collected from different sources such as IMF,World Bank, Barro and Lee, OECD database, US Bureau of Labour Statistics, US Bureau of Economic Analysis, and relevant Journals. Our findings and results are robust because the evidence proves that different policies implemented by Chinese government have brought substantial positive impact on national economy at micro and macro level.

Keywords: FDI, GDP, Gini Co-Efficient, Income Inequality, Poverty Alleviation

CHALLENGES FOR HIGHER EDUCATION POLICY IN INDIA (Published)

There has been a significant growth in enrolment in higher education in recent years; which has been substantially contributed by the private sector in technical education. However, despite various initiatives, a New Education Policy after 1992 is yet to be promulgated which is in sync with India’s liberalization policy to foster quality & improve Human Development Index (HDI). Research and excellence remain a serious challenge, compounded by policy prevarication. Public funding arrangement is grossly inadequate and largely to elitist institutions. The paper argues that our obsession with improving enrolment has to give way to credible quality improvement measures. Specifically there is a need to upscale public spending, treat private sector as a partner, improve industry academia interface, encourage research, Public Private Partnership (PPP), improve infrastructure and encourage FDI into higher education sector through MoUs with reputed foreign universities. The paper also cautions against recent ambivalence towards Open Distance Learning (ODL).

Keywords: FDI, HDI, Liberalization, ODL, PPP

FACTORS AFFECTING FOREIGN DIRECT INVESTMENT IN PAKISTAN (Published)

Foreign Direct Investment (FDI) plays a crucial role in speeding up the development and economic growth of a country. In developing countries rely on FDI to promote their economy as they face capital shortage for their development process. The strong growth performances experienced by Pakistan economy greatly depends on the FDI. FDI generates economic growth by increasing capital formation through the expansion of production capacity, promotion of export and creation of employment in Pakistan. FDI inflows of Pakistan started fluctuating from 1990s to 2012 and this high volatility of Pakistan FDI inflows drew the researchers’ attention to examine the factors affecting FDI inflows in Pakistan by using the annual data from year 1988-2012. Multiple linear regressions model is applied to study the relationship between explanatory variables and explained variable. Empirical results show that gross capital formation, exports, gross national income, have significantly and positively affect Pakistan FDI inflows. Other than that, external debt also significantly affects Pakistan FDI inflows but its relation with FDI is negative. Imports of Pakistan are the final goods & its relationship with the FDI inflow in Pakistan is negative. It is significant affect on FDI in Pakistan. Due to the war conditions in Pakistan the military expenditures increases sharply which shows the foreign investors disinterest in Pakistan from last few years and our results also shows a significant and negative relationship between military expenditures and FDI inflow in Pakistan.

Keywords: EXDT, EXP, FDI, GCF, GNI, IMP, MEXP

An Analysis of the Life Cycle of Foreign Affiliates in a Small Open Economy: The Case of Greece 1960-2010 (Published)

The intellectual aspiration of the paper is to highlight the evolution of MNE activity in the Greek economy during the 1960-2010 period, using as intellectual analytical tools theories of FDI such as the Investment Development Path and New Institutional Economics apparatus. By imposing a time dichotomy in two sub-periods (1960-1980) and (1981-2010) we point out that in the first period, the economic environment was characterized by low wages, trade protection with tariffs and quotas, thus this period is the period of protectionism. During this early period, foreign MNEs had penetrated the Greek market with resource seeking (RS) and tariff-jumping (TJ) affiliates.

In the second period, which is the period of integration, the economic traits have changed. Thus infrastructure has been improved, wages have risen, trade barriers were gradually perished, and Greek firms started to engage in advertising and marketing and created their own branded products. This period has three sub-periods (1981-1990, 1991-2000, 2001-2010). During these sub-periods foreign MNEs, gradually but steadily reduce the number of RS and TJ affiliates and replace them with new market seeking (NMS) Greenfield affiliates stemmed from TJ units and acquisitions. We also highlight, that throughout the period although the total volume of FDI increased in absolute numbers, in relative terms (i.e. viz. a viz. other states), Greece failed to attract massive FDI inflows for a variety of reasons. Thus this research is associated with the evolution of FDI in a small open economy, its specific forms and with the survival of foreign plants. We have applied descriptive statistical methods and we have found out that in the 1960-2010 period foreign investments in Greece have been transformed. Thus in the early period (1960-1980) foreign MNEs prefer to engage in resource-seeking and tariff jumping investments, where as in the second period (1981-2010) foreign multinationals invest in new market seeking Greenfield affiliates. These results for the case of the Greek economy are reported for the first time. Furthermore, these results can be used as a specific case study of the evolution of a small and increasingly integrated open economy.

 

Keywords: Business History, FDI, Greece, Multinational Enterprises