 How does South-South FDI affect host economies? Evidence from China-Africa in 2003–2018Kevin H. Zhang International Review of Economics & Finance, 2021, vol. 75, issue C, 690-703 Abstract: Foreign direct investment (FDI) from emerging markets to developing countries has increased significantly for recent decades. Such the South-South FDI tends to behave differently from the North-South FDI. The rise of China's FDI (C-FDI) in Africa has generated considerable controversy. While the popular opinion in Africa about C-FDI is positive, the Western reaction often is highly negative. How does C-FDI affect Africa's economies? Do C-FDI and the North-FDI have different impacts on Africa? This paper studies the issues by using the cross-country panel data in 2003–2018. We find that benefits from C-FDI to African economies are greater than those from the North FDI, and that the promoting effects of C-FDI concentrate on host-country's exports and industrialization. Uniquely the large Chinese investment in Africa's infrastructure not only contributes overall economic growth, but also enhance host-country's absorptive capacity in attracting and utilizing foreign capital. Keywords: Foreign direct investment (FDI); China's FDI (C-FDI); South-South FDI; North-South FDI; Industrialization; Economic growth (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:75:y:2021:i:c:p:690-703 DOI: 10.1016/j.iref.2021.04.015 Access Statistics for this article International Review of Economics & Finance is currently edited by H. Beladi and C. Chen More articles in International Review of Economics & Finance from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.