Abstract

Foreign direct investment (FDI) in Sub-Saharan Africa increased substantially in the 1990s. However, the rate of increase was meager compared with that in other regions. As shown in Table 7.1, for example, between the 1980s and 1990s, FDI in the region grew by about 218 percent. This compares with an increase of 993 percent for East Asia and the Pacific, 556 percent for Latin America and the Caribbean, 789 percent for South Asia, and 755 percent for all developing countries. As a consequence, Africa’s share of FDI to developing countries has declined over time, from about 19 percent in the 1970s to 9 percent in the 1980s and to about 3 percent in the 1990s. This is in spite of the policy reforms implemented by countries in the region. Thus, with regard to FDI, Africa’s experience compared with that of other developing countries can be characterized as one of “absolute progress but relative decline.”