THE GOVERNANCE PUZZLE: FDI, DOMESTIC INVESTMENT, AND INCLUSIVE GROWTH IN WAEMU

Abstract

Foreign direct investment (FDI) is an important source of external finance for developing countries. In the West African Economic and Monetary Union (WAEMU) region, FDI has experienced a relatively uneven development in recent years. However, it can have a significant impact on the host economies, including crowding in or displacing domestic investment. The effect of FDI on domestic investment is influenced by a wide range of factors, including competition regime, economic policy, level of technology, performance of domestic firms, and governance