Munich Personal RePEc Archive

Effect of location incentives on regional distribution of foreign direct investment in Ghana

Obeng, Camara Kwasi (2016): Effect of location incentives on regional distribution of foreign direct investment in Ghana.

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Abstract

The use of location incentives for in-country dispersion of foreign direct investment (FDI) has become popular among countries in recent times in spite of the lack of consensus of its effectiveness in the literature. Location incentives are also common in Ghana. This study, therefore, explores the effect of location incentive as a tool for influencing the location of FDI away from the Greater Accra region to the remaining nine regions of Ghana, particularly, the three northern regions, Upper East region and Upper West region and Northern region. Using the Ghana Investment Promotion Centre data set from 1994 to 2015 and employing trend analysis, the results reveal that there is no relationship between location incentives and regional location of FDI. The study recommends that government should provide social and economic infrastructure in the northern part of Ghana so as to make the area attractive to foreign investors.

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