International Journal of Business and Economic Development

During the eighties, Latin America was surrounded by economic crises, increased external debt, and poor growth of the Gross Domestic Product as well as little attraction of foreign direct investment (FDI).
Later in the nineties, some countries in the region inspired by the desire to eliminate the protectionist model had to undertake reforms that sought to achieve their commercial opening to start a new economic model and thereby show the world as an attractive area for attracting investment mainly from Europe and Asia.

          One of the countries that made institutional changes by creating good conditions in the nineties as well as in the next decade to attract FDI was Colombia. The purpose of this paper is to demonstrate how Colombia attracted foreign capitals during 2005-2012. A probit model was applied (Botello, J.&Davila, M.,2015) to determine if the probability of improving the number of determinants to attract FDI will result in more inflows. The results show that the design of an industrial policy focused on attracting FDI, as well as the increase of the Gross Domestic Product, the offer of natural resources to foreign investors, the skilled workforce and the improvements in infrastructure were the determinants that increased the attraction of capitals. The implications for policy makers are to improve the rest of the determinants studied in this original research to increase the FDI flows into Colombia.
 

The study presents considerations for African countries that build off of Crump, Hill, and Taylor (2017). In that study, Crump et al. (2017) argue and present empirical evidence to support the notion that rates of black entrepreneurship (measured by black business ownership) in the U.S. currently presented in entrepreneurship literature are misleading and understated. Once formal and informal economy are considered together, the authors propose that entrepreneurship rates of blacks drastically increase, and likely surpass many other groups. This exploratory study similarly argues and presents evidence that actual rates of business ownership and entrepreneurship derived from formal economy activities in Africa likewise understate the actual rates of entrepreneurship and business ownership there. This study also shows that there are many more advantages to operating in the formal economy than there are to be operating in the informal economy. A tool is provided that can aid entrepreneurship educators to highlight some hidden advantages and disadvantages to people choosing to operate in either economy.

Interest rate policy is perhaps one of the most controversial policies in Nigeria and has drawn the attention of several scholars, thus, its contribution to the investment base of the economy remains unclear. This paper, therefore, examined the impact of interest rate on investment in Nigeria between the period 1981 and 2015. Secondary data were collected from the Central Bank of Nigeria Statistical Bulletin 2016. The study estimated the Johansen Multivariate Co-integration model and Error Correction Model (ECM) to analyse the data. Results of the co-integration test shows the existence of a long-run relationship between the proxies for interest rate (MLR, MPR, SAVR) and investment proxied by Gross fixed Capital formation (GFCFG). The ECM result revealed that MLR and MPR have negative and statistically significant impact on investment in Nigeria. While SAVR has a positive impact on investment but its impact is not also statistically significant. The ECM also indicates that 40% disequilibrium that occurred in the previous year would be corrected in the current period. This paper concludes that high interest rate inhibits investment, thus, it is recommended amongst others, that monetary policy rate and lending rate be reduced to a single digit to make it attractive for investors to access funds. This would translate to economic growth in the country.

The determinants of FDI include any host country’s situations that affect the inflow of FDI, like market size, the economic growth rate, real growth domestic product, infrastructure, natural resource, the political situation etc.  In recent years, Ethiopia has started encouraging the inflow of FDI by improving the investment climate and by providing different incentive packages. The focus of this review is to identify the major determinants of foreign direct investment (FDI) in Ethiopia.  The results show that variables like real growth domestic product, liberalization, exchange rate devaluation, and trade openness are significant and have a positive correlation with the inflow of FDI in Ethiopia. On the other hand, variables like inflation, poor infrastructure, the volatile and high lending interest rate havea significant and negative association with the inflow of foreign direct investment.  Finally, the study recommends possible intervention of the government through infrastructure development and formulation of sound fiscal and monetary policies to control the negative impact of inflation, interest rate and other macro variables.   

The aim of this study is to investigate the effect of housing finance on economic growth of West African States while the specific objectives were to: analyse the contributions to housing finance by mortgage banks on the economic growth of Nigeria, examine the impact of aggregate housing finance on economic growth of Ghana among others. Secondary data were used, covering the period of study 1985-2014. The ex-post facto research design was adopted in this study. The data gathered were analysed using Ordinary Least Square Regression Method. The findings revealed that the housing finance markets in Nigeria and Ghana are under developed.  The policy implication is that if urgent steps is not taken to address the housing needs of the region, more people are going to live in slumps. We recommend that the government of WA States should create an enabling environment to attract both local and foreign investors to invest in the housing sector.