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Sub-Saharan Africa is poorer than other developing regions in the world. African governments had embarked on substantial reform programmes to promote trade liberalisation and attract foreign direct investment. The study explores the motivations of foreign firms in choosing SSA as their investment location and examines the investment needs of the host economies. In modelling the home motivations, we distinguish between the labour and non-labour factors that attract FDI. The needs of the recipients are captured via the growth effect of FDI through the trade channel. The presence of...

The book analyses the impact of foreign capital and exports on the African labour market. Evidence shows that African workers are more productive and benefit from higher wages in the presence of foreign and exporting firms. We observe that exposure to international markets and foreign competition brings a number of benefits to African producers like learning and adopting international best practices. Productivity may, however, vary with the degree of foreign ownership and exporting activities of African producers as well as the markets in which they supply their commodities.