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FDI Determinants in Least Recipient Regions: The Case of Sub†Saharan Africa and MENA


  • Godwin Okafor
  • Jenifer Piesse
  • Allan Webster


This paper explores the determinants of foreign direct investment (FDI) into FDI least recipient regions. Panel data for 20 sub†Saharan Africa (SSA) and 11 Middle East and North Africa (MENA) countries are used for the period 2000–12. Findings of the fixed effects estimations suggest that FDI inflows into these regions are influenced by GDP per capita, infrastructure development, trade openness, and control of corruption. Conversely, inflation negatively affects FDI inflows, and rents from natural resources do not significantly influence FDI. Furthermore, the findings show that marginal benefits from any increase in the quantity of FDI determinants (with the exception of control of corruption) will be less for SSA countries. The paper concludes with important policy implications deduced from the findings.

Suggested Citation

  • Godwin Okafor & Jenifer Piesse & Allan Webster, 2017. "FDI Determinants in Least Recipient Regions: The Case of Sub†Saharan Africa and MENA," African Development Review, African Development Bank, vol. 29(4), pages 589-600, December.
  • Handle: RePEc:bla:afrdev:v:29:y:2017:i:4:p:589-600
    DOI: 10.1111/1467-8268.12298

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    References listed on IDEAS

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    3. Simplice A. Asongu & Joseph Nnanna & Paul N. Acha-Anyi, 2021. "The Openness Hypothesis in the Context of Economic Development in Sub-Saharan Africa: The Moderating Role of Trade Dynamics on FDI," The International Trade Journal, Taylor & Francis Journals, vol. 35(4), pages 336-359, July.
    4. Simplice Asongu & Christelle Meniago & Raufhon Salahodjaev, 2022. "The role of value added across economic sectors in modulating the effects of FDI on TFP and economic growth dynamics," International Journal of Emerging Markets, Emerald Group Publishing Limited, vol. 18(11), pages 5087-5108, February.
    5. William Bekoe & Talatu Jalloh & Wassiuw Abdul Rahaman, 2021. "Corruption and Foreign Direct Investment Inflows: Evidence from West Africa," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 14(3), pages 7-25, December.
    6. Vanessa S. Tchamyou & Simplice A. Asongu & Nicholas M. Odhiambo, 2019. "The Role of ICT in Modulating the Effect of Education and Lifelong Learning on Income Inequality and Economic Growth in Africa," African Development Review, African Development Bank, vol. 31(3), pages 261-274, September.
    7. Simplice A. Asongu & Mushfiqur Rahman & Joseph Nnanna & Mohamed Haffar, 2020. "Enhancing Information Technology for Value Added Across Economic Sectors in Sub-Saharan Africa," Research Africa Network Working Papers 20/064, Research Africa Network (RAN).
    8. Asongu, Simplice A. & Odhiambo, Nicholas M., 2020. "Foreign direct investment, information technology and economic growth dynamics in Sub-Saharan Africa," Telecommunications Policy, Elsevier, vol. 44(1).
    9. Simplice A. Asongu, 2020. "Financial Access and Productivity Dynamics in Sub-Saharan Africa," International Journal of Public Administration, Taylor & Francis Journals, vol. 43(12), pages 1029-1041, September.
    10. Simplice A. Asongu & Nicholas M. Odhiambo, 2022. "Financial Access and Value Added in Sub-Saharan Africa: Empirical Evidence from the Agricultural, Manufacturing and Service Sectors," Working Papers 22/009, European Xtramile Centre of African Studies (EXCAS).
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