📄 Abstract
This study investigates the relationship between foreign direct investment (FDI) and trade balance in Sub-Saharan Africa over the period 2005 ? 2022. Employing a quantitative research design, the analysis utilizes balanced panel data from the World Bank. The conceptual framework positions trade balance as the dependent variable and FDI as the independent variable. Empirical analysis is conducted through regression techniques and diagnostic checks to assess the robustness and significance of the relationship. Pooled regression model reveals a statistically significant relationship, with an adjusted R-squared of 0.557, indicating that FDI accounts for 55.7% of the variations in trade balance. The FDI coefficient of 0.704 implies that a 10% increase in FDI leads to a 7.046% improvement in the trade balance. Based on these findings, the study recommends that governments in Sub-Sahara Africa implement policies to attract and sustain FDI, such as offering incentives and enhancing investment climate.
🏷️ Keywords
📚 How to Cite:
Nahabwe Patrick Kagambo John, Kagarura Willy Rwamparagi, Munyambonera Ezra , FOREIGN DIRECT INVESTMENT AND TRADE BALANCE IN SUB-SAHARAN AFRICA , Volume 13 , Issue 1, january 2025, International Journal of Southern Economic Light (JSEL) ,