The Significance of WTO’s Trade Related Investment Measures (TRIMs) Agreement For Inward FDI in Sub-Saharan Africa

Mumtaz Shah

MPRA Paper from University Library of Munich, Germany

Abstract: The significance of a crucial WTO accession agreement component, that is, Trade Related Investment Measures (TRIMs) agreement in increasing Sub-Saharan African developing country’s appeal for investors from abroad is assessed over here. Conventional FDI location determinants like macroeconomic stability, market size, infrastructure, trade openness and economic development are also considered. Utilising yearly data for 38 Sub-Saharan developing nations over the time period from 1988 to 2015 in a panel form, the researcher found that removal of market distortions through TRIMs, sound macroeconomic management, infrastructure availability, liberalisation of investment and trade regime have plausible significant effects on FDI inflows. Contrary to the empirical FDI literature economic development is found to be insignificant and market size sensitive to the addition of explanatory variables, especially, WTO led TRIMs. Time invariant features such as language, geographical location and sea access cannot be evaluated as fixed effect panel estimation technique does not support them.

Keywords: FDI; WTO; TRIMs; Panel Data and Sub-Saharan Economies (search for similar items in EconPapers)
JEL-codes: C23 F13 F14 F15 F21 F23 K33 (search for similar items in EconPapers)
Date: 2017-01-30
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (12)

Published in City University Research Journal 1.7(2017): pp. 17-29

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