The determinants of Foreign direct Investment in the manufacturing sector in Kenya
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Date
2012Author
Kithinji, Carolyne Gatwiri
Type
ThesisLanguage
enMetadata
Show full item recordAbstract
In this era of increasingly globalized world economy, FDI is a particularly significant driving
force behind the interdependence of national economies. Even though most of the FDI flows
have always concentrated in the developed countries, its importance is undeniable for developing
countries as well. Through private direct investments, developing countries are participating
more than ever before in the global production network.
It is widely acknowledged that FDI has potential benefits that can accrue to developing
countries. This view is based on the theories that suggest that FDI is important for economic
growth as it provides the much needed capital for investment, increases competition in host
countries economies, and aids local firms to become more productive by adopting more efficient
technology or by investing in human or physical capital. Theories and studies conducted on FDI
determinants have different approaches and do not necessarily replace each other but explain
different aspects of the same phenomenon.
This paper provides fresh evidence on the determinants of FDI inflows on the manufacturing
sector in Kenya based on a survey of foreign firms in Kenya as at 2011. Results from this study
show that Kenya needs to improve its macroeconomic environment i.e. economic growth and
stability and strengthen its institutional base which affect political environment and regulatory
policies. The government should put a lot of resources to curb crime and restore law and order,
embrace positive democratic practices, maintain stability and embrace zero-tolerance on
corruption in order to gain substantially in investment growth and FDI flows.
Citation
MBA Thesis 2012Sponsorhip
University of NairobiPublisher
School of Business, University of Nairobi
Subject
Economy,Production,Growth,FirmsDescription
Master Thesis