scholarly journals Sustaining Economic Growth in Sub-Saharan Africa: Do FDI Inflows and External Debt Count?

2021 ◽  
Vol 14 (4) ◽  
pp. 146
Author(s):  
Udi Joshua ◽  
David Babatunde ◽  
Samuel Asumadu Sarkodie
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Trade Openness ◽  
External Debt ◽  
Sub Saharan Africa ◽  
Economic Expansion ◽  
Fdi Inflows ◽  
Distributed Lag ◽  
Sub Saharan ◽  
The Impact

The quest for the attainment of economic development is sought after by all global economies, which by effect is expected to transcend to improving livelihoods and standard of living. However, several factors hinder the process of achieving sustained economic development, especially in developing countries. In this regard, assessing the extent of economic expansion orchestrated by foreign direct investment (FDI) inflows in vulnerable economies such as Sub-Saharan Africa (SSA), particularly in the face of the significant fall in global FDI inflow, is worthwhile. In essence, this study ascertains the impact of FDI inflows and external debt on economic growth amidst decline in FDI inflows and excessive foreign borrowings. The mixed order of integration from the stationarity test underpins the adoption of autoregressive distributed lag (ARDL) approach for data covering the period 1990 to 2018. The empirical results found FDI inflows play a crucial role in achieving economic expansion in the region. On average, FDI inflows, external debt, and foreign aids are more useful in expanding the economy compared to trade openness and exchange rate. Thus, this study recommends the need for SSA to open its economic borders for external capital, viz. FDI. A peaceful economic and political environment is a pre-condition to attract and maintain potential foreign investors. Stability in exchange rates is critical in achieving growth in FDI and other foreign resources. However, caution is required, especially in administration of external resources. Particularly, contracting external debt must strictly be driven by economic reasons rather than political motivation. Borrowed funds could be injected mainly into productive streams with the highest investment returns to boost economic development.

Human Capital Formation and Economic Growth in Sub-Saharan African Countries: An Empirical Investigation

2020 ◽  
Vol 68 (2) ◽  
pp. 249-268
Author(s):  
Taiwo Akinlo ◽  
Olusola Joel Oyeleke
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Economic Development ◽  
Sub Saharan Africa ◽  
African Countries ◽  
Education And Health ◽  
Level Of Economic Development ◽  
Sub Saharan ◽  
Generalised Method Of Moments ◽  
The Impact

This study explored human capital–economic growth nexus and determine if the relationship is influenced by the level of economic development in 36 sub-Saharan African countries during the period from 1986–2018. The study used dynamic generalised method of moments (GMM) and static estimations to achieve the objective of the study. The study used alternative indicators of human capital to provide strong evidence and robust results. The study also considered the income groups within the region. The study found that human capital contributed to economic growth, as its indicators are positive and significant. The study also found that the connection that exists between human capital and economic growth also depends on the level of economic development. Generally, our finding emphasised that both education and health measures of human capital are important, and that policymakers must consider the level of economic development while formulating policies that can enhance the impact of human capital on economic growth in the Sub-Saharan Africa region.

scholarly journals Impact of Government Expenditure on Economic Growth In Sub-Saharan Africa: A Validity of Wagner’s Law

2021 ◽  
Vol 9 (02) ◽  
pp. 2039-2150
Author(s):  
Funsho Kolapo ◽  
Azeez Bolanle ◽  
Joseph Mokuolu ◽  
Taiwo Oluwaleye ◽  
Kehinde Alabi
Keyword(s):  
Economic Growth ◽  
Government Expenditure ◽  
Sub Saharan Africa ◽  
Capital Projects ◽  
Wagner’S Law ◽  
Distributed Lag ◽  
Negative Effect ◽  
Wagner's Law ◽  
Sub Saharan ◽  
The Impact

The study investigated the impact of government expenditure on economic growth with special inclination to testing the Wagner’s law in Sub Saharan Africa between 1986 and 2018. Adopting the Panel first generation tests as well as the Panel Auto Regressive Distributed Lag (ARDL) and Pairwise Causality techniques, it was revealed that government expenditure causes economic growth rendering the Wagner’s law is invalid in the Sub-Saharan region. Also, it was further discovered that capital and recurrent expenditure exert negative effect on economic growth while total expenditure has positive effect on economic growth in the region. Therefore, based on the negativity of capital and recurrent expenditure, it is recommended that capital and recurrent expenditure must be monitored effectively to ensure that its increase will not exert any negative effect on economic growth while stringent measures as well as checks and balances must be adopted to curb corruption in Sub-Saharan Africa to ensure that funds are used exclusively for their intended purposes especially those pertaining to capital projects.

scholarly journals Financial Inclusion, Income Inequality and Sustainable Economic Growth in Sub-Saharan African Countries

2021 ◽  
Vol 13 (4) ◽  
pp. 1780
Author(s):  
Chima M. Menyelim ◽  
Abiola A. Babajide ◽  
Alexander E. Omankhanlen ◽  
Benjamin I. Ehikioya
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Financial Services ◽  
Sub Saharan Africa ◽  
Kuznets Curve ◽  
African Countries ◽  
Financial Access ◽  
Sub Saharan ◽  
Sustainable Economic Growth ◽  
The Impact

This study evaluates the relevance of inclusive financial access in moderating the effect of income inequality on economic growth in 48 countries in Sub-Saharan Africa (SSA) for the period 1995 to 2017. The findings using the Generalised Method of Moments (sys-GMM) technique show that inclusive financial access contributes to reducing inequality in the short run, contrary to the Kuznets curve. The result reveals a negative effect of financial access on the relationship between income inequality and economic growth. There is a positive net effect of inclusive financial access in moderating the impact of income inequality on economic growth. Given the need to achieve the Sustainable Development Targets in the sub-region, policymakers and other stakeholders of the economy must design policies and programmes that would enhance access to financial services as an essential mechanism to reduce income disparity and enhance sustainable economic growth.

scholarly journals The Impact of Industrialization, Trade Openness, Financial Development, and Energy Consumption on Economic Growth in Indonesia

Economies ◽  
2021 ◽  
Vol 9 (4) ◽  
pp. 174
Author(s):  
Khalid Eltayeb Elfaki ◽  
Rossanto Dwi Handoyo ◽  
Kabiru Hannafi Ibrahim
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Least Squares ◽  
Financial Development ◽  
Correction Term ◽  
Trade Openness ◽  
Ordinary Least Squares ◽  
Distributed Lag ◽  
Long Run ◽  
The Impact

This study aimed to scrutinize the impact of financial development, energy consumption, industrialization, and trade openness on economic growth in Indonesia over the period 1984–2018. To do so, the study employed the autoregressive distributed lag (ARDL) model to estimate the long-run and short-run nexus among the variables. Furthermore, fully modified ordinary least squares (FMOLS), dynamic least squares (DOLS), and canonical cointegrating regression (CCR) were used for a more robust examination of the empirical findings. The result of cointegration confirms the presence of cointegration among the variables. Findings from the ARDL indicate that industrialization, energy consumption, and financial development (measured by domestic credit) positively influence economic growth in the long run. However, financial development (measured by money supply) and trade openness demonstrate a negative effect on economic growth. The positive nexus among industrialization, financial development, energy consumption, and economic growth explains that these variables were stimulating growth in Indonesia. The error correction term indicates a 68% annual adjustment from any deviation in the previous period’s long-run equilibrium economic growth. These findings provide a strong testimony that industrialization and financial development are key to sustained long-run economic growth in Indonesia.

China’s Economic Expansion in Sub-Saharan Africa

2018 ◽  
pp. 113-148
Author(s):  
Rhys Jenkins
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Sub Saharan Africa ◽  
Economic Expansion ◽  
Economic Relations ◽  
Different Types ◽  
Sub Saharan ◽  
The Impact ◽  
Engineering Projects

The chapter documents the growth of economic relations between China and Sub-Saharan Africa (SSA), focussing on trade, foreign direct investment, Chinese construction and engineering projects, loans, and aid. The chapter highlights the way in which these are sometimes combined in resources-for-infrastructure deals. It shows the variety of different actors involved in these relationships, including state and non-state actors, on both the Chinese and African sides. It then discusses the role of strategic diplomatic, strategic economic, and commercial objectives in the growing Chinese involvement in SSA. It also addresses questions of African agency and the interests of African actors in economic relations with China. The impact of political, strategic economic and commercial factors on different types of economic relations is then analyzed econometrically.

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