THE IMPACT OF FDI ON GROWTH OF SAUDI ECONOMY: AN EMPIRICAL EVALUATION OF MANUFACTURING SECTOR

Hisham J. Bardesi ()
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Hisham J. Bardesi: King Abdulaziz University, Saudi Arabia

Eurasian Journal of Economics and Finance, 2016, vol. 4, issue 3, 1-13

Abstract: Foreign Direct Investment (FDI) inflows have produced considerable impact on the economy of the Kingdom of Saudi Arabia, both directly and indirectly, by playing major role in stimulating the growth potentials and providing stability to the Kingdom’s economy. This study aims to evaluate the impact of FDI inflows on the economy of Saudi Arabia in general, and on the manufacturing sector in particular, over the last few decades, more specifically over the period from 1968 to 2014, by using Ordinary Least Square (OLS) method. The results showed positive significant impacts, but limited, of FDI on manufacturing sector in Saudi Arabia during this period. The results also found positive impacts of labor, non-oil private capital formation, and the latest Foreign Investment Act (FIA) enacted in 2000. Finally, conclusion and recommendations to promote the role of FDI in developing the manufacturing sector of Saudi Arabia.

Keywords: FDI; MNCs; Economic Growth; Manufacturing Sector; FIA Journal: Eurasian Journal of Economics and Finance (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:ejn:ejefjr:v:4:y:2016:i:3:p:1-13

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