Foreign Direct Investment in Africa

Foreign Direct Investment in Africa—Some Case Studies

April 1, 2002

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Format: Chicago

Anupam Basu, and Krishna Srinivasan. Foreign Direct Investment in Africa—Some Case Studies, (USA: International Monetary Fund, 2002) accessed July 8, 2025

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

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.

Subject: Balance of payments, Economic sectors, Environment, Exports, Foreign direct investment, International trade, Natural resources, Privatization, Tax incentives, Taxes

Keywords: A number of country, A number of host-country factor, Africa, Asia and Pacific, Central and Eastern Europe, Countries in Africa, Credit risk rating, Economic reform, Economic reforms, Equity capital, Europe, Exports, FDI flow, FDI inflow, Foreign direct investment, Global, Host-country market, Market size, Monopoly Lesotho Electricity Corporation, Natural resources, Private sector, Privatization, Reform program, Stability, Tax incentives, WP

Publication Details

Pages:

41
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2002/061
Stock No:

WPIEA0612002
ISBN:

9781451848182
ISSN:

1018-5941

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