Effects of foreign direct investment on sustainable development in the eccas: role of debt burden

Abstract Foreign Direct Investment (FDI) plays a crucial role in the economic and sustainable development of the countries of the Economic Community of Central African States (ECCAS). The objectives of this article are to analyze the effects of FDI on sustainable development in ECCAS countries, while assessing the role of debt burden. We used a model estimated by the GMM technique in a system, based on a sample of ten (10) countries for the period from 2015 to 2023. The results show, on the one hand, that FDI marginally promotes sustainable development, regardless of whether it is weak or strong in ECCAS countries. On the other hand, it appears that FDI, conditioned by the debt burden, marginally inhibits sustainable development. These conclusions are largely confirmed by robustness tests based on Kripfganz's (Generalized method of moments estimation of linear dynamic panel-data models. In: 2020 Stata conference 14, Stata Users Group, 2020) two-stage GMM estimation method.