Analyzing the Impact of Inward Foreign Direct Investment on Employment Creation in the East African Community (EAC)
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Date
2012-08
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Publisher
ZENITH International Journal of Business Economics & Management Research
Abstract
As an engine of economic development for developing countries, foreign direct investment (FD)
inflows have contributed for creation of employment, technology transfer to local firms, and
managerial know-how; have had positive effects on exports and access to external markets. This
study tries to analyze the impact foreign direct investment (FDI) inflows on employment
generation/creation within the East African Community (EAC), which is the regional
intergovernmental organization of the Republics of Tanzania, Kenya, Uganda, Rwanda and
Burundi. It specifically estimates the effect of FDI on employment creation in the EAC for the
period of 2004 to 2008. The study adopted a case study design with a quantitative research
approach and it represents an econometric analysis using statistical package for social sciences
(SPSS). The results show that there is strong (positive) relationship between the variables. This
means that foreign direct investments (FDI) have a big significant impact on the pattern of
employment opportunities. Then from above analysis we may conclude that EAC’s employment
creation especially, does depend upon foreign direct investment inflows.
Description
Keywords
Employment creation, FDI, and Unemployment