Impacts of inward FDIs and ICT penetration on the industrialisation of Sub-Saharan African countries

This paper examines the impact of inward foreign direct investments (FDIs) on the industrialisation pro-cess in Sub-Saharan African (SSA) countries. Furthermore, the underlying analysis is investigated under consideration of the impact of information and communication technology (ICT) penetration. The paper uses a data sample from 47 countries from 1996 to 2017. Results indicate that FDIs negatively affect SSA countries' industrialisation process and that this relationship is compounded by a high degree of ICT penetration. Additional findings show that the GDP and the degree of industrialisation have a U-shaped relationship and that exports as well as domestic investment hamper the industrialisation process of SSA countries. The findings indicate that policymakers should critically analyse inward FDIs and the condi-tions necessary to achieve their beneficial effects. (C) 2020 Elsevier B.V. All rights reserved.

Automated summary

This paper examines the impact of inward foreign direct investments on the industrialisation process in SSA countries, finding that FDIs have a negative effect on industrialisation, especially with high ICT penetration. The study also shows a U-shaped relationship between GDP and industrialisation, and that exports and domestic investment hinder industrialisation in SSA countries.