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Vol. 8 No. 2 (2025): February

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Foreign Direct Investment Inflows to Selected Sub-Sahara African (SSA) Countries Behaved Differently in The Global Financial Crisis of (2007-2008) Relative to Previous Global Financial Crises

Onu, King Ezebunwa
Department of Economics, Ignatius Ajuru University of Education, Rumuolumeni, Port Harcourt, Rivers State, Nigeria

Corresponding Author(s) : Onu, King Ezebunwa

king_onu@yahoo.com

American Journal of Economics and Business Management, Vol. 8 No. 2 (2025): February

Abstract

This study investigated the behavior of foreign direct investment inflows to selected Sub-Sahara African (SSA) Countries during (2007- 2008) global financial crisis relative to previous financial crises. This study was motivated by the assertion that developing economies are immune to the financial and economic meltdown that originated in developed world in 2007. Specifically, the study examined whether the behavior of foreign direct investment inflow to SSA differs in the context of (2007-2008) global financial crisis compared with the previous global financial crises in the short and long-run situations. Using panel datasets from 26 SSA countries, the study explored non-stationarity and heterogeneous – based dynamic panel estimators namely, mean group (MG) and pooled mean group (PMG) to empirically implement the objective. The findings of the study amongst others revealed that foreign direct investment (FDI) inflows to SSA significantly differs in behavior in the context of the (2007- 2008) global financial crisis in the short and long run situations. The study suggests policy that may stabilize growth of FDI inflows, such as allowing free license of operation, maintaining exchange rate stability, improving the business climate and guaranteeing strong and stable macroeconomic performance. Thus, more foreign investors should be attracted, and trust in current ones would rise, which should increase investment opportunities and growth in the region. Therefore, greater attention should be given to FDI whenever global financial crisis is experienced.

Keywords

global financial crisis foreign direct investment foreign portfolio investment developing economies sub-saharan africa
Ezebunwa, O. K. . (2025). Foreign Direct Investment Inflows to Selected Sub-Sahara African (SSA) Countries Behaved Differently in The Global Financial Crisis of (2007-2008) Relative to Previous Global Financial Crises. American Journal of Economics and Business Management, 8(2), 842–852. Retrieved from https://www.globalresearchnetwork.us/index.php/ajebm/article/view/3336
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