Abstract:
Foreign Direct Investment (FDI) has been one of the topical issues in
international economics, especially, from the past decade. Empirical
research on FDI in developing countries, such as Ghana, has been
relatively scarce even though there has been a lot of work on the trends in
FDI. This study attempts to examine the trend of Foreign Direct
Investment (FDI) in Ghana and its relationship with some selected
economic indicators such as exchange rate, inflation, interest rates, Gross
Domestic Product (GDP) as well as employment and the structural
stability of FDIs with respect to the variables. Yearly data on FDI was used
for the study spanning from 1994 to 2010. Results from the study
indicated that FDI inflows into the country had experienced an increasing
trend and undergone structural changes over the period under study.
Furthermore, exchange rates and GDP growth played a significant role in
attracting FDI into the country.
