The Effects of Preferential Trade Agreements on Foreign Direct Investment: Evidence from the African Caribbean Pacific Region

Aruna Gounder, Rodney Falvey, Gulasekaran Rajaguru

Research output: Contribution to journalArticleResearchpeer-review

Abstract

Our empirical analysis utilises panel data on bilateral FDI stocks from 34 OECD countries into 45 ACP countries over the period 2000–2017 to consider the role of PTAs in attracting FDI. We control for policies relating to trade, taxes and investment, along with other explanatory variables identified in the literature. We conclude the prevalence of market seeking FDI in the ACP region, with a role for regional integration in accessing surrounding market potential. We find no significant effect of PTAs on FDI in the Caribbean, while in Africa, the effects depend on the presence of a bilateral BIT.
Original languageEnglish
Number of pages23
JournalOpen Economies Review
DOIs
Publication statusE-pub ahead of print - 14 May 2019

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Africa
Bilateral
Pacific region
Preferential trade agreements
Foreign direct investment
Regional integration
Market potential
OECD countries
Panel data
Tax
Empirical analysis

Cite this

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The Effects of Preferential Trade Agreements on Foreign Direct Investment: Evidence from the African Caribbean Pacific Region. / Gounder, Aruna; Falvey, Rodney; Rajaguru, Gulasekaran.

In: Open Economies Review, 14.05.2019.

Research output: Contribution to journalArticleResearchpeer-review

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