Can Africa Increase its Global Share of Foreign Direct Investment (FDI)?

Abstract

Foreign Direct Investment (FDI) has increased much in both relative and absolute terms in the past two decades or so. The literature on FDI has received great attention in the recent past. To the best of my knowledge none of the studies that have been made on FDI has tried to examine whether Africa can increase its global share of FDI inflow. In this work, I address this question because I think that it has great relevance to, and importance for the continent and its people. A desire to identify the potential roles of FDI is one of the driving forces behind this work. After the introduction, I present some definitions of FDI. This is followed by a description of Africa’s current share of global FDI inflow. Then I examine the potential roles of FDI in host economies or recipient countries. After a consideration of the determinants of FDI, I discuss the issue of whether or not Africa can increase its global share of FDI inflow. This will lead to a section on opportunities and potentials for Africa in respect of its capacity for increasing its share of global FDI inflows. I end with a summary and conclusion.