Munich Personal RePEc Archive

The Significance of WTO’s Trade Related Investment Measures (TRIMs) Agreement For Inward FDI in Sub-Saharan Africa

Shah, Mumtaz Hussain (2017): The Significance of WTO’s Trade Related Investment Measures (TRIMs) Agreement For Inward FDI in Sub-Saharan Africa. Published in: City University Research Journal , Vol. 7, No. 1 (30 January 2017): pp. 17-29.

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Abstract

The significance of a crucial WTO accession agreement component, that is, Trade Related Investment Measures (TRIMs) agreement in increasing Sub-Saharan African developing country’s appeal for investors from abroad is assessed over here. Conventional FDI location determinants like macroeconomic stability, market size, infrastructure, trade openness and economic development are also considered. Utilising yearly data for 38 Sub-Saharan developing nations over the time period from 1988 to 2015 in a panel form, the researcher found that removal of market distortions through TRIMs, sound macroeconomic management, infrastructure availability, liberalisation of investment and trade regime have plausible significant effects on FDI inflows. Contrary to the empirical FDI literature economic development is found to be insignificant and market size sensitive to the addition of explanatory variables, especially, WTO led TRIMs. Time invariant features such as language, geographical location and sea access cannot be evaluated as fixed effect panel estimation technique does not support them.

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