Impact of Environmental Quality on Foreign Direct Investment Inflows into Ghana, Kenya, Nigeria and South Africa

Abstract

This study examined the impacts of the surrounding business environment on the inflow of foreign direct investment into Ghana, Kenya, Nigeria and South Africa. Finding out how much the environment has impacted FDI inflow into South Africa, Ghana, Nigeria, and Kenya is the goal. The population density, land/air pollution rate, and investment climate (nitrous oxide emissions) are included in the variable scope as independent variables. The inflows of foreign direct investment served as the dependent variable. The data was analyzed using time series analysis, more precisely the multiple panel regression analysis method, with the Cobb Douglass model serving as the theoretical framework. The World Bank Statistics and the Statistical Bulletin of the nations under study were the sources of the data. According to the findings, population density dramatically reduced foreign direct investment (FDI), whereas nitrous oxide emission put forth a significantly positive effect on FDI inflow into these countries. It was suggested that the governments of South Africa, Ghana, Nigeria, and Kenya should work to improve their economic standing by bolstering their economies through significant export-oriented production, which will increase economic growth and draw in more foreign direct investment.