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Foreign direct investment in the South Pacific Island Countries: a case study of Fiji

Author

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  • T.K. Jayaraman
  • Chee-Keong Choong

Abstract

The South Pacific region has been lagging behind in growth in comparison to similarly placed island countries in the Caribbean and Indian Ocean regions. This paper, which undertakes an empirical study, establishes that the rate of growth, market size, openness policy and real exchange rate are crucial determinants of foreign direct investment (FDI) inflows into Fiji. Further, the Granger noncausality test based on Vector Error Correction Model shows that there is a bi-directional causal linkage between FDI and economic growth. The conclusion is that Fiji should adopt an appropriate policy environment for encouraging the growth inducing FDI inflows.

Suggested Citation

  • T.K. Jayaraman & Chee-Keong Choong, 2006. "Foreign direct investment in the South Pacific Island Countries: a case study of Fiji," World Review of Entrepreneurship, Management and Sustainable Development, Inderscience Enterprises Ltd, vol. 2(4), pages 309-322.
    • Handle: RePEc:ids:wremsd:v:2:y:2006:i:4:p:309-322
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    Citations

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    Cited by:

    1. Makun, Keshmeer Kanewar, 2016. "Direct Foreign Investment and its Determinants: A Case Study - Gli investimenti diretti esteri e loro determinanti : studio di un caso," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 69(2), pages 151-174.
    2. T. K. Jayaraman & Hong Chen & Markand Bhatt, 2014. "Research Note: Contribution of Foreign Direct Investment to the Tourism Sector in Fiji: An Empirical Study," Tourism Economics, , vol. 20(6), pages 1357-1362, December.

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