Re-Investigating Foreign Direct Investment and Poverty Alleviation: Does Status Quo Still Hold within ECOWAS Sub-Region?

Abstract

The focus of this study is to examine the relationship between FDI inflows and poverty alleviation in 16 ECOWAS countries between 1990 and 2017. FDI Data and other macroeconomic data were collected from UNCTAD investment report and WDI respectively. Consequently, different panel techniques were employed for the analysis of the study. The findings that originated from this work established the following among others that FDI inflows contributed significantly to poverty alleviation in ECOWAS countries. Also, the spillovers of FDI projects contributed an impressive rate at which poverty is been alleviated in this economic bloc. Therefore, as a result of these important findings, this paper makes the following recommendations for the policy makers, investors, financial institutions regulators and future researchers as follows: firstly, the policy makers in ECOWAS countries should embark on policy measures that will further facilitate the sporadic inflows of FDI in this economic bloc. Also, FDI projects could be a viable means of achieving sustainable development goal of poverty eradication in ECOWAS region. Because whenever poverty alleviation is the target of the policy makers in ECOWAS countries, manipulating FDI inflow in appropriate direction, its spillover effects will diffuse to the reduction of poverty in the long run.