The Impact of Infrastructure development on Foreign Direct Investment in Cameroon

Stéphane Mbiankeu Nguea

MPRA Paper from University Library of Munich, Germany

Abstract: Better access to improved infrastructure services is one of the components of a favourable investment climate for foreign investors and an important engine for sustainable economic growth. This study investigates the impact of communication, energy and transport infrastructure development on Foreign Direct Investment (FDI) in Cameroon over the period 1984-2014. Auto Regressive Distributed Lags (ARDL) bounds test approach to cointegration has been applied to analyse the annual time series data coming from United Nations Conference on Trade and Development (UNCTAD) and World Development Indicators (WDI). The results show that communication infrastructure exerts a positive and significant impact on FDI inflows. In addition, energy infrastructure reduces the volume of FDI inflows, while transport infrastructure is not relevant in attracting FDI inflows. According to these findings, this study recommends that the government of Cameroon pay further attention to improving the quality of infrastructure in order to attract more FDI.

Keywords: Infrastructure; ARDL; FDI; Cameroon (search for similar items in EconPapers)
JEL-codes: F21 H41 R42 (search for similar items in EconPapers)
Date: 2021-06-20
New Economics Papers: this item is included in nep-fdg, nep-int and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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