Compared to the rest of the world, Africa has not been a major recipient of foreign direct investment (FDI). In 2013, Africa’s share of FDI inflows to developing regions was about 7.3 percent and its share of global FDI inflows was about 3.9 percent. Although FDI inflows to Africa has increased over the years, the level of FDI that Africa attracts is indeed insufficient compared to its resource base and its potential need. This study is aimed at identifying the determinants of FDI inflows to Africa and the reasons for low FDI inflows to Africa in order to suggest policies that can be implemented and programs that can be put in place to increase sustainable FDI inflows to Africa. Several existing studies on the Determinants of FDI in Africa focus on the traditional determinants of FDI. However, the contribution of this study to existing literature lies in the scope, model and method. This study is organized as follows; section 3 presents a brief review of the relevant literature on the determinants of FDI, section 4 provides the research method, section 5 includes the model specification and section 6 presents the results of the analysis.
KeywordsForeign Direct InvestmentFDI DeterminantsEconomic GrowthInflationCorruptionPolicy Terrorism
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