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Determinants of direct foreign investment: Evidence from Jordan

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  • Khrawish, Husni Ali
  • Siam, Walid Zakaria

Abstract

In order to show the effect of direct foreign investment flows on the economy of Jordan, this study comes to examine the economic and financial risks on FDI on the macro level over the period (1997- 2007). This study applies a version of the model developed by Chan and Gemayel (2004) by using Multiple Linear Regression Model. The analysis revealed that there exists significant and positive relationship between foreign direct investment flows into the economy of Jordan and economic and financial variables. The study claims for further FDI promotion through incentives to attract new investments. These factors are: providing targeted fiscal incentives, such as tax concessions, cash grants, and specific subsidies; improving domestic infrastructure; promoting local skills development to meet investor needs and expectations; establishing broad-reaching FDI promotion agencies and improving the regulatory environment and decreasing red tape.

Suggested Citation

  • Khrawish, Husni Ali & Siam, Walid Zakaria, 2010. "Determinants of direct foreign investment: Evidence from Jordan," Business and Economic Horizons (BEH), Prague Development Center (PRADEC), vol. 1(1), pages 1-9, April.
    • Handle: RePEc:ags:pdcbeh:95943
    DOI: 10.22004/ag.econ.95943
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    References listed on IDEAS

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    6. Steve Onyeiwu & Hemanta Shrestha, 2004. "Determinants of Foreign Direct Investment in Africa," Journal of Developing Societies, , vol. 20(1-2), pages 89-106, June.
    7. Singh, Harinder & Kwang W. Jun, 1995. "Some new evidence on determinants of foreign direct investment in developing countries," Policy Research Working Paper Series 1531, The World Bank.
    8. Robert E. Lipsey, 2001. "Foreign Direct Investors in Three Financial Crises," NBER Working Papers 8084, National Bureau of Economic Research, Inc.
    9. International Monetary Fund, 2004. "Risk Instability and the Pattern of Foreign Direct Investment in the Middle East and North Africa Region," IMF Working Papers 2004/139, International Monetary Fund.
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    Cited by:

    1. Feyza BALAN, 2019. "The effects of political and financial risks on foreign direct investments to the MENAT countries," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(619), S), pages 121-138, Summer.
    2. Ali, Muhammad Ali & Asfand, Asfand Yar Khattak & Bakhtiyar, Bakhtiyar Khan & Hammad, Raja Hammad Amhed, 2014. "Financial Risk and Foreign Direct Investment: Evidence from Pakistan Economy," MPRA Paper 60779, University Library of Munich, Germany, revised 12 Dec 2014.
    3. Luma Al-Qudah & Barbara Piontek & Judit Olah, 2021. "Economic Growth and Foreign Direct Investment in the Context of Financial Development: Evidence from Jordan," European Research Studies Journal, European Research Studies Journal, vol. 0(2B), pages 762-782.
    4. Zohaib AKHTAR* & Hafiz Muhammad YASIN**, 2015. "Terrorism and Political Instability Implications for Foreign Direct Investment: A Case Study of South and South East Asian Countries," Pakistan Journal of Applied Economics, Applied Economics Research Centre, vol. 25(1), pages 67-98.

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