Детерминанты прямых иностранных инвестиций из стран с развивающимися рынками в Тропическую Африку: исследование Ганы

In recent decades, advances in globalization and the falling of trade barriers have led firms to subset operations to other countries (Alfaro, 2017). This has steered a large scale of foreign direct investment (FDI) from emerging economies (EE) to other emerging markets, especially in Sub-Saharan Africa (SSA).
SSA has been a very attractive place for investment for decades now. Investment in the sub-region is dominated by advanced economies1. They are typically viewed as advantage exploiting in nature (Buckley et. al., 2016). Collis (2014) points out that, subsidiaries of multinational corporations are usually set up in emerging economies to take advantage of the country-specific advantages (CSAs) available such as resources and cheap labor. The market, however, was not usually the target for multinational companies (MNCs) from developed countries. Nevertheless, that has changed over the last decade, as more and more firms from emerging economies especially from Asia-pacific and also within Africa are investing in SSA.
The fastest-growing economies in the world are all emerging economies (UNCTAD, 2019). The average economic growth per year in the global economy is 3.4% per year; advanced economies 1.7% per year and emerging economies 4.6% per year. SSA has experienced a growth of 3.6% per year (IMF, 2019)2. The top five fastest-growing economies are all from emerging markets, three of which are in SSA (IMF, 2019). This has completely changed the landscape of investment thereby making the sub-region more attractive to investment especially from emerging economies such as China, South Africa, and India.
The phenomenon of FDI from emerging market economies to other emerging economies has become a very hot topic over the last decade (Yan & Luo, 2016). However, not much is known about the real motives of this investment into SSA because there have always been conflicting views about the core reasons for investment. Most official information given by governments of investing countries and companies is that these investments provide economic aid by increasing the GDP and providing jobs (Sun, 2017). Other scholars (Izuchukwu & Ofori, 2014; Ndikumana & Sarr, 2016) argue that FDI to SSA is a win-lose situation where African countries lose due to capital flight and overexploitation of resources. These conflicting opinions make it difficult to understand the real motives of investment by emerging market multinational companies (EMNCs) or emerging market state-owned enterprises (EMSOEs) that invest in
1 See Appendix A.1 2 See Appendix A.2
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Africa hence the need to conduct this research using Ghana as a case study to find the real motives of investment.
It needs to be acknowledged that the decision for an EMNC or EMSOE to enter a foreign market depends on a wide range of factors. The geographical position of the country, its economic attractiveness, resource availability, and strategic goal of the EMNC or EMSOE in its internationalization, among other factors, are very vital in the decision-making process. Notwithstanding these factors, politics and bilateral relationships do play a major role when it comes to the internationalization of firms from emerging markets (Busse, Erdogan, & Mühlen, 2016). As soft power is a political tool used by countries to exert their influence around the globe, FDI is a very common tool countries use in influencing other countries to support their international, political strategy (Nye, 2015).
This research has both practical and theoretical importance. Theoretically, the research contributes to the South-South FDI literature. It fills the research gap about FDI from emerging markets to SSA, taking into consideration the determinants for investment, its influence on the decision-making process, and how FDI regulations of host countries in SSA attract these investments. Also, the research elaborates on how the determinants of investments affect which sectors receive FDI. A framework is developed to match the sectoral investment based on the determinants of investment. This framework can, therefore, be used in further FDI studies about the behavior of EMNCs and EMSOEs and their pattern of investment in SSA. Practically, this research has managerial implications that will allow EMNCs and EMSOEs to understand how, when, and where to invest based on the trend of investment from their competitors to SSA. Managers can influence some of these factors to their advantage and can therefore strategically invest in sectors based on their specific goals as to whether, they want a long, medium, or short- term return on investment. In terms of political factors and corporate social responsibility, it will be easier for firms to understand which sectors have social-political roles and which sectors are related to strictly economic benefits. This will then shape their strategy of investment in SSA.
The subject of this thesis is foreign direct investment from emerging markets while the object is Sub-Saharan Africa, using Ghana as the case study.
The main goal of this paper is to elucidate the factors that make Ghana an attractive location for EE FDI. In other words, to understand why emerging economies invest in SSA. The analysis countenances an inquiry into the factors that influence EMNCs and SOEs to choose Sub-Saharan Africa, especially locations such as Ghana instead of choosing advanced markets or
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other emerging markets closer to their countries of origin. These factors can be economic, cultural, geographic, or political.
There are three major objectives of this paper. First and foremost, the paper aims to contribute to the FDI literature by filling the gap in the extant literature about the motives of investment and its economic or political implications. The novelty of the topic (hot topic) abhors a multidimensional empirical framework that allows us to determine the influence that resources, cheap labor, economic growth, location, similarities in culture and political ties (bilateral relationship) have on the propensity of an EMNC or EMSOE to invest in Ghana. To derive this model, a thorough literature review is done to identify the determinants of investment by EMNCs and EMSOEs in the African sub-region. This enables understanding of the common entry mode chosen by these firms. The framework will latently be useful in ameliorating the knowledge in the behavior of EMNCs concerning investment in Ghana.
Secondly, the paper aims to explore sectoral investments by EMNCs. The industries in which EMNCs choose are determined by their motives. To understand why they invest in certain industries and their motives of investment, the researcher develops an evaluation system for classifying the motives of investment based on a) industries where investors benefit immediately (manufacturing, resources, hospitality) and b) industries where social effects dominate (education, infrastructure, medicine). The researcher argues that industries that EMNCs invest in are different and are influenced by the country of origin of the EMNC. Some countries invest more in industries where social effects dominate while others invest in industries where returns are instant. In rare cases do we find a mixture of both from the same country.
Thirdly, the researcher wants to point out the role of social contribution by FDI in the least developed economies. In the case of Ghana, the extent of economic aid provided by FDI, compared to the level of opportunism resulting from FDI is discussed. This will help in making recommendations for policymakers concerning FDI regulations.
The existing literature in the sphere of internationalization and entry mode choice focusing on Ghana, SSA, and emerging markets were used in making this research. Secondary data from the Ghana Investment Promotion Center, Oxford Economics, United Nations Industrial Development Organization, Ghana Statistical Service, UNIDO, World Bank, and UNCTAD were also analyzed. Notwithstanding, publicly available databases such as the ORBIS, and MarketLine were used for the firm-level analysis.
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The master’s thesis consists of three chapters. These three chapters provide a well- organized, logical, and coherent understanding of the topic, which focuses on providing a well- detailed explanation and framework to fill the gap in the existing literature about FDI to Ghana.
The first chapter focuses on the theoretical background of the study. It centralizes on the theory of internationalization strategies by MNCs as well as research on FDI to emerging markets, with the focus on SSA and Ghana. Dunning’s Ownership-Location-Internalization (OLI) framework which is commonly referred to as the eclectic paradigm is used as the basis of the theoretical research. The researcher examines why EMNCs choose to merge, acquire, or wholly own a subsidiary in SSA instead of choosing a low-risk, a lower-return approach like export or licensing. Also, the researcher seeks to shed light on the impact of location on the decision of EMNCs and sometimes EMSOEs to invest in certain countries in SSA. Furthermore, the researcher analyses why firms choose to have most of their operations in-house by setting up subsidiaries in different countries rather than having suppliers along the value chain.
The second chapter focuses on research methodology chronicling the approach used in analyzing the data, the methodology of the research, and preliminary findings. It is inherent that the methodology and design of the research are discussed. A justification of a chosen method used, data collection, and analysis are accurately explained. In this regard, the second chapter seeks to explain the research strategy chosen to arrive at the empirical part of the study.
The third chapter further dives into the empirical study of the research. The focus on this chapter is on FDI as the main internationalization strategy of EMNCs to SSA. It studies how the country-specific advantages (CSAs) such as factor market and institutional conditions help Ghana to become an attractive destination for EMNCs and EMSOEs that are looking to augment their firm-specific advantages (FSAs) and arbitrage the factor cost differences to create a competitive advantage. I do so by exploring existing research on the effects of CSAs on attracting EMNCs to wholly invest in a certain country (Cantwell, 2014; Collis, 2014; Dunning, 2001; Ghemawat, Altman, & Bastian, 2018). The effects of institutions of emerging market countries on the propensity to invest is also explored. In this case, the impact of the ease of doing business, regulations to protect foreign companies, tax breaks among others are all factors that determine the likelihood of an EMNC investing in a country. The researcher also focuses on FDI as economic aid. It is vaguely said that the only way for emerging economies in SSA to catch up with developed countries is through foreign aid. Therefore, FDI is seen as a form of “corporate social responsibility” by EMNCs and is highly praised by governments and policymakers. A handful of researchers see it otherwise. However, it is unclear whether this investment does
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indeed provide the economic aid that is promised or whether opportunism is at the core of these investments. This leaves a gap in the literature that needs to be explored further. Consequently, this paper recesses the extent of economic aid provided to Ghana through FDI.
The remaining part of the research is devoted to further discussion on the contribution of the finding to existing theory as well as the managerial implication of the finding in helping EMNCs decide on which sectors (industries) to invest, how to provide economic aid and what factors to be taken into consideration when determining where to invest in SSA. On the other hand, governments are advised to be wary of FDI as economic aid, and made policies accordingly. The researcher provides a limitation of this research and possible ideas for future research.