Foreign Direct Investment in Africa-Some Case Studies

41 Pages Posted: 10 Feb 2006

See all articles by Anupam Basu

Anupam Basu

International Monetary Fund (IMF) - African Department

Krishna Srinivasan

International Monetary Fund (IMF) - African Department

Date Written: March 2002

Abstract

This paper reviews the experiences of a few countries in Sub-Saharan Africa that have succeeded in attracting fairly large amounts of foreign investment. The review indicates that sustained efforts to promote political and macroeconomic stability and implement essential structural reforms have been the key elements contributing to the success that certain countries in Africa have achieved in attracting a substantial volume of FDI. Strong leadership, which has helped promote democracy and overcome social and political strife, and a firm commitment to economic reform have been important determinants. The adoption of sound fiscal and monetary policies, supported by an appropriate exchange rate policy, and a proactive approach to removing structural impediments to private sector activity have had a positive bearing on investor sentiment. The analysis underscores the importance of relying on stability and a broad-based reform effort to encourage foreign investment in Africa.

Keywords: Africa, Foreign direct investment, stability, economic reforms

JEL Classification: F21, F23

Suggested Citation

Basu, Anupam and Srinivasan, Krishna, Foreign Direct Investment in Africa-Some Case Studies (March 2002). IMF Working Paper No. 02/61, Available at SSRN: https://ssrn.com/abstract=879545

Anupam Basu (Contact Author)

International Monetary Fund (IMF) - African Department ( email )

1700 19th Street, NW
Washington, DC 20431
United States

Krishna Srinivasan

International Monetary Fund (IMF) - African Department ( email )

1700 19th Street, NW
Washington, DC 20431
United States

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