The Contribution of Foreign Direct Investments for Regional Economic Development: In The Case Of Oromia Regional State
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Date
2019-06
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Addis Ababa University
Abstract
This study assesses the contribution of foreign direct Investment for regional economic
development: In the case of Oromia regional state. A sample of 77 foreign companies and 406
respondents from the local community used as a primary source and secondary data obtained
from the federal and Oromia bureaus were analyzed in the process of answering the basic
questions. After the data has been collected, it was analyzed using linear regression and
Descriptive statistical analysis. The result of the study indicates that there is a positive
relationship between the regional economic growths Vs foreign direct investment and regional
tax revenue Vs inflow of foreign direct investment. However, less positive correlation exhibited
among the dependent and independent variables in both contexts. The job opportunities have
been creating for the local community. However, in terms of the quality of the job they are very
poor which characterized by poor payment and unskilled labor recruitment. The social
development practice by the foreign companies in the region indicates that, they are actively
participating in the provision of clean water for the local community. Regarding the human
capital development, the study found that the foreign companies’ participation is minimal to
zero. Based on the major findings the study forwarded recommendation for the foreign
companies and for the regional government as well.
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FDI Economic contribution in Oromia Region