The Impact of Foreign Direct Investment on Agricultural Trade in Africa

Does Political Stability Matter

Bibliographic Data

ID4388979
AuthorsMichael Kwowove Didongo (0009-0004-4139-6205, Department of Economics Kwame Nkrumah University of Science and Technology Kumasi Ghana), Samuel Tawiah Baidoo (0000-0001-5941-6308, Department of Economics Kwame Nkrumah University of Science and Technology Kumasi Ghana, corresponding author)
Year2025
Volume76
Issue260
Pages319-339
Publication date2025-08-16
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueInternational Social Science Journal (JOURNAL)
Journal identifiersISSN: 0020-8701 • E-ISSN: 1468-2451
PublisherWiley (PUBLISHER • GB)
DOI10.1111/issj.70005
OpenAlexW4413418463
LanguageEN
References cited42

Promoting intra-African agricultural trade (ATR) is crucial as far as achievement of the Sustainable Development Goal 2 (SDG 2) (zero hunger) is concerned. Utilizing data from 54 African countries spanning 1996-2021, this article examines the impact of foreign direct investment (FDI) on intra-ATR, while investigating the relevance of political stability (PS) in this relationship. To achieve this, agricultural exports of selected commodities measured in thousands of dollars are used. Within the framework of the gravity model and utilizing the Poisson pseudo maximum likelihood (PPML) estimation technique, the results reveal that FDI contributes positively to intra-ATR. Similarly, PS is found to have a significant positive effect on intra-ATR. However, the interaction term of FDI and PS shows that the latter does not complement the former in promoting intra-ATR. On the basis of the findings, it is recommended that African governments implement measures to boost FDI across the continent. Doing so would supplement domestic capital, stimulate agricultural production and enhance export capacity. Furthermore, maintaining PS remains essential, as it significantly supports the growth of intra-ATR

Agriculture · Development economics · Economics · Foreign direct investment · Geography · International economics · International trade · Macroeconomics · Political science · Political stability · Politics · Global trade and economics · International Business and FDI · International Development and Aid

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