Master of Economic Policy and Planning - Main Campus

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Browsing Master of Economic Policy and Planning - Main Campus by Subject "Direct investment"

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    Exchange rates and foreign direct investment in Uganda
    (Kampala International University, College of Economics and management, 2021-10) Muse Dirie, Abdirashid Elmi
    It has been argued theoretically that stable exchange rate has positive and significant influence on foreign direct investment hence leading to economic growth. Hypothetically, a stable exchange rate is often considered to be conducive for attracting foreign direct investment (FDI). However, economic theories alone cannot adequately predict the relationship between exchange rate and foreign direct investment. Accordingly, the effect of exchange rate on foreign direct investments remains a controversial issue in empirical literature. This calls for an empirical investigation to measure the effect of exchange rate movements on foreign direct investment. This study examines the relationship between exchange rate and FDI inflows in Uganda using time series data for the period 1990 to 2017. The Fully Modified Ordinary Least Squares (FMOLS) estimation techniques method was used. The study revealed a positively significant relationship between exchange rate movement and foreign direct investment in Uganda over the period. But there is insignificant positive relationship between inflation rate, Gross Domestic Product (GDP) and foreign direct investment inflows in Uganda. It is therefore recommended that effective monetary policies should be pursued by Bank of Uganda to stabilize the exchange rate sustainably. Such policies have the tendency to improve FDI inflows into the country.
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    Foreign direct investment and economic growth in Uganda (1986- 2016)
    (Kampala International University, College of Economics and Management, 2019-04) Keinadid, Mohamed Abdiasis
    Study used multivariate vector auto regressive model (VAR) to investigate the impact of foreign direct investment (FDI) on economic growth, and assess the determinants of FDI inflows in Uganda for the periods between 1986 and 2016. Interpretations of results are based on Granger Causality and innovation accounting (variance decomposition and impulse response functions). The study finds that international capital flows are of great importance in stimulating economic growth in Uganda. Results further revealed that the determinants of economic growth are foreign direct investment(FDI), human capital, infrastructure, trade openness The study detected three different channels through which FDI inflows impacts on economic growth in Uganda. The First one is direct transmissions from FDI to GDP growth. The second channel is indirectly through domestic investments and by multiplier process, higher level of economic growth is generated. The third channel is through exports thereby yielding export-led growth. macro economic stability through proper policies among others all these will attract FDI’s. The government should however put in place measures to limit FDI’s from coming along with experts from their home countries but rather employ the local people this will reduce problems of retrenchment or lay off some workforce that comes along with privatization. This will also will also solve the problem of limited skills and lead to skills improvement among the people as well as reduce unemployment. There is adequately need for an adequate policy on the development and management of the FDIs in order to avoid the negative effect of some trade of FDI nature, regulations and monitoring is adequately needed to ensure proper form of the foreign businesses [n the country together with enhancing the management situation for the management of the business for economic growth.
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    Inflation and foreign direct investment in Uganda from 199m2015
    (Kampala International University, College of Economics and Management, 2017-08) Mohamed, Abdul Mursal
    The main purpose of this study was to investigate the effects of inflation on foreign direct investment in Uganda from 1990-2015. It was driven by two major objectives; which are;to determine whether the inflation significantly effects foriegn direct investment in Uganda. And to examine the causality between inflation and foreign direct investment in Uganda.Usjng time series data from the World Bank and Uganda Bureau of Statistics, both correlation and regression analysis statistical tools were applied to investigate and explaining the variation in inflation.Using Consumer Price Index capitalis considered which can be taken as the independent variable. As well as foriegn direct investmen.representing Uganda’s total of equity capital is considered which is taken as the independent variable in this study examined the impact of inflation on FDI in Uganda and found that inflation has a negative impact on FDI. On average, this study concludes that inflation has been decreasing from three digits in mid 1980s to double digits in l990s and 2000s.The data also shows the FDI has been generally increasing in the recent years though with a lot of fluctuation. This is because, the investment environment in terms of security and economic factors like inflation having generally been conducive in the country explaining why FDI has been increasing on average. The correlation analysis showed that inflation is negatively related to FDI implying that when inflation increases, FDI reduces. Furthermore, the findings of regression analysis showed that the inflation explain 63.31% of the variation in overall Foreign direct investments in the country. The P-value ( 0.0002) of the model also showed that the model is statistically significant and the diagnostic tests were carried out to confirm that the model was relevant. This study suggests to encourage FDIin Uganda, because encouraging FDI is a key ingredient to sustainable economic gro~h.So it isa necessary to use best practices in investment regulations to attract FDI by making easy three conditions, which are Entry procedures, Locating procedures and Operating procedures. As well as Tax Incentives which encourages foreign investors, when it comes to FDI encourage in a competitive world, governments should turn to special fiscal incentives in order to attract the ever more mobile multinational companies. So that it will hold up FDI in Uganda as this would enable Uganda witness high and sustainable growth. Also FDI should be incourage towards the industrial sector and more especially agricultural sector of the economy since agriculture is the backbone of the Uganda’s an economy.