The impact of foreign direct investment on export growth in Tanzania

Thumbnail Image
Journal Title
Journal ISSN
Volume Title
University of Dar es Salaam
African countries have been stressed with low economic performance for several decades. Empirical evidence shows that most African countries including Tanzania have poor export performance which is the reason behind low economic growth. Currently, in many countries, the attraction of FDI has been seen as a solution to promote export performance and therefore economic growth. For this reason this study examined numerically the impact of FDI inflow on export growth in Tanzania using time series data for a period of 36 years from 1980-2015. Data used in the study was obtained from the World Bank, being gathered from the data base thereof, were analyzed using Excel and SPSS analysis package. The empirical results indicated a strong and positive relationship between FDI inflow and the export growth in Tanzania, such that a dollar increase in FDI inflow cause increase in export by 0.967 million US $. A unit $ increase in FDI leads to almost a million $ increase in exports then creating a good environment for FDI attraction in order to increase export in the country is worthy it. It is therefore recommended that open and export oriented policies together with fiscal and monetary policies that will lead into attraction of FDI in the country in order to realize exports and economic growth massively. In the light of this study, more research is needed to provide in depth knowledge about the impact of FDI on other economic variable like GDP growth and BOP and employment creation in Tanzania by using similar or different methodologies. Also it will be interesting to find out the impacts of export growth on FDI and the effects of GDP growth on FDI inflow in order to find out the direction of causality and the magnitude of their impacts.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HG4538.T34T87)
foreign direct investment, export growth, Tanzania
Tusekile, I. (2017) The impact of foreign direct investment on export growth in Tanzania. Master dissertation, University of Dar es Salaam. Dar es Salaam.