DETERMINANTS OF FOREIGN DIRECT INVESTMENT INFLOW IN SELECTED WEST AFRICAN COUNTRIES, 1990-2019

The rate at which West African nations attract Foreign Direct Investment is poor as compared to other regions. Thus, this study ascertains the factors that determine the inflow of Foreign Direct Investment in selected West African Nations from 1990 to 2019. The study used panel data regression analysis. The study found that market size, infrastructure development, trade openness and natural resources rent accounted for about 72% variation in the inflow of FDI to the six West African nations during the period under review. The study, therefore, concluded that macro-economic factors and natural resources endowments of these nations are crucial determinants that compels Foreign Direct Investment inflow. Based on these findings, the study recommends that government authorities in these West African nations should invest more in developing infrastructures to attract more Foreign Direct Investment to their countries. Also, Foreign Direct Investment should be directed to the industries where they have high linkage and positive spillover effects for both the long and the short run economic advantages.