Foreign Direct Investment in Ethiopia and its Contribution to the Socioeconomic Status

Abstract

This study examined the inflow of foreign direct investment (FDI) to Ethiopia and its comparative enhancement and contribution for the socioeconomic growth and development from 1992 to 2016. It reviews the overall FDI prospects and several major impacts towards the socioeconomic issue. In addition, it explains and analyzes Ethiopia's current business situations, investment incentives, the behaviour of investment market, the reasons why FDI would be cancelled, the reasons why Ethiopia is preferable than other African countries for FDI and the socioeconomic reactions with the environment of FDI. It also briefs the facts of historical and current whereabouts of FDI in the country and it greatly improves the investment practitioners' decision-making, pointing them to a possible solution for their business goals and helps to settle the investor's psychological influences on the investment sectors. FDI is advantageous of picking up the economic development to the maximum limit for the developing countries and Ethiopia as a developing country its economic boom starts with the flow of FDI into the country's different regions in different investment sectors. This study utilizes primary data were gotten through interviews, discussions and questionnaires and secondary data were obtained from journals, magazines, newspapers, textbooks and internet.