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VOL. 11, ISSUE 3 (2025)
The impacts of foreign direct investment (FDI) on developing countries
Authors
Dr. Mohammed Saje Jajere, Dr. Ibrahim Aliyu Shehu
Abstract
This paper looks at Foreign Direct Investment
(FDI) and its impact to developing countries. The efforts of FDI to assuage
developing economics are also discussed, the capital flow from developed
countries to developing ones are looked at and the impact are spelt out. The global
economy is continuously becoming borderless and globalised which is somewhat
attributed to FDI. To safeguard FDI, a legal document termed Multilateral
Agreement on Investment (MAI) was introduced to serve as a constitution
overriding the law and regulation of host countries when it comes to
international investment and operations. MAI was targeted later as a threat to
democracy by anti-globalisation activist which led to its downfall. Political
stability plays a vital role in attracting FDI however, countries like Nigeria
with abundant natural resources such instability may not be too relevant. Where
political instability relates to high crime, corruption and or labour disputes,
it deter the flow of FDI especially in sub-Saharan Africa and south Asia. The
paper concludes by showcasing FDI as a tool for financial globalisation and how
countries benefits from FDI where countries with high inflow of FDI are more
developed than those with little inflow, and the negative impact it causes to
the environment especially those investment from mining sector and the way FDI
rendered local investment out of business.
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Pages:33-37
How to cite this article:
Dr. Mohammed Saje Jajere, Dr. Ibrahim Aliyu Shehu "The impacts of foreign direct investment (FDI) on developing countries". International Journal of Law, Vol 11, Issue 3, 2025, Pages 33-37
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