Factors Affecting Foreign Direct Investment Growthin Ethiopia

Abstract

The purpose of the study was to investigate factors Affecting Foreign direct investment growth in Ethiopia. The research design used was explanatory with the help of descriptive type. For this research study, 148 respondents were chosen from a total population of 235 by using purposive non probability sampling technique. This study employed both primary and secondary data sources in order to identify factors that affect foreign direct investment growth in Ethiopia. For this study, one dependent and three independent variables were employed: namely, Foreign Direct investment was the dependent variable of this study. While, economic related factors, Social related factors, institutional related factors were the independent variables of this study. The correlation matrix and assumptions of regression was tested and valid by the use of SPSS 26-version software. Finally, the researcher was forwarded a suggested solution based on the identified finding: the government should stabilize economic factors like GDP, Inflation, Foreign direct investment and also the government should respect rule of law, stabilize political situation of the country, minimize tax burdens that adversely affect FDI inflows and improve the basic social infrastructure in order to enhance Foreign direct investment growth in Ethiopia