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Aid for Trade and Greenfield Investment

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  • Lee, Hyun-Hoon
  • Ries, John

Abstract

The Aid for Trade (AfT) Initiative was launched in 2005 at the Hong Kong Ministerial Conference where high-income countries pledged to increase their AfT contributions to developing countries. AfT, comprised almost entirely of aid for trade-related infrastructure and building productive capacity, would promote growth by easing supply-side constraints and improving transportation, energy, and communication infrastructure. By lowering costs of operating in recipient countries, AfT may increase both trade and investment. Most research on the effects of AfT on international transactions focuses on trade. The sparse research on investment investigates aid and net foreign direct investment flows based on the international balance of payments. We contribute to the literature by assessing AfT effects on new greenfield investment.

Suggested Citation

  • Lee, Hyun-Hoon & Ries, John, 2016. "Aid for Trade and Greenfield Investment," World Development, Elsevier, vol. 84(C), pages 206-218.
    • Handle: RePEc:eee:wdevel:v:84:y:2016:i:c:p:206-218
    DOI: 10.1016/j.worlddev.2016.03.010
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    Keywords

    Aid for Trade; greenfield investment;

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