Browsing by Author "Nowe Dorah"

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    The Impact of International Capital Flows on Poverty in Uganda:1985-2022
    (Kampala International University, 2023-06) Nowe Dorah
    The study investigated the impact of International Capital Flows on poverty in Uganda. The study was guided by three specific objective, to ascertain the impact of Foreign Direct Investments (FDI), Foreign Aid on poverty and Remittances on poverty in Uganda in the period between 1985-2022. This study followed a Correlational research design showing the extent to which the relationship between the study variables exists. Time series data for the period 1985 - 2022. Secondary data was used in this study. The data was obtained from the Bank of Uganda Statistical Bulletin, UBOS and Financial review for various years. The study followed the Juselius (1990) Co-integration technique and error correction models to estimate the long and short-run relationships in the variables. The first step in analyzing the time series data was to perform unit root testing using Augmented Dickey-Fuller (ADF) Test as suggested by Dickey and Fuller (1979). Further, to establish the short run effect of ICF on poverty, a vector error correction model (VECM) by Granger (1986) was used. On the study results, the Johansen co-integration trace shows that there was a long run relationship between ‘poverty-POVt, and other main variables included; GDP deflator (GDPDFt), Net Foreign Direct Investment (NFDIt), Net Remittances (NREMt), Net external debt (NEXDt), and Net official development assistance (NODAt). In the long run, the coefficient of foreign aid was negative and significant at 5 percent level. Another finding on the effect of remittances on Poverty in particular revealed that FA positively contributes to poverty reduction in an economy. In conclusion, the foreign aid had a significant negative and positive relationship with poverty levels respectively at 5 percent level; and a positive long run and positive effect relationship between International Capital Flows, labor force, capital formation, trade openness, foreign direct investment and poverty reduction. Therefore, the study recommends that BOU should continue its collaboration with relevant authorities to enhance quality of data on remittances and to assess the impact of remittances on Standard of living. Further, BOU should continue to develop its national payment systems and improve access to financial services. Policies should provide incentives that substantially reduce the price of using electronic payments.