An Emperical Study on the Strategies to Attract Foreign Direct Investments in Tanzania

Abstract

This paper dwells on the investment strategies in attracting FDI into Tanzania, the investment reforms have been expected to become a major factor responsible for the increased FDI inflow in to the country, these reforms including political system, economic management and government administration. Despite of the several efforts such as the far reaching reform in the economy done by Tanzania to increase FDI inflows in the country, the results are far from satisfactory. It has been revealed that the unsatisfactory FDI inflow into Tanzania is primarily caused by the improper strategies resulted from the inadequacy of FDI determinants in the country. The study found that Tanzania lacks the adequate strategies due to poor FDI determinants that would attract a substantial FDI inflow into the country. This makes it necessary for the country to make sure that the determinants like better infrastructure, adequacy of government agencies; favorable macro economic, political conditions are available in adequate amount and quality. It is concluded that proper strategies in influencing investment regulatory frameworks, policies that promote macroeconomic stability, improved physical infrastructure and institutional reforms are important in attracting more FDIs into a country and therefore are highly recommended.

Institutions and Foreign Direct Investment: Evidence from Sub-Saharan Africa Regions

“…Abdulla et al 2012;United Nations, 2010). Despite these reforms inward FDI to the region has remained low in comparison to fellow developing countries.…”

Investment Incentives as a Mediator in the Relationship between Macroeconomic Variables and Growth of Private Domestic Investment in Kenya

“…In this regard, the government has embarked on formulation of policies and incentives that are meant to attract investors into the country. Investors are set to enjoy tax incentives yet another strategy to promote investment (Abdulla, Othman, & Hongzhong, 2012). The Kenya Revenue Authority (2018) characterizes the tax incentive as an arrangement that grants any individual or action positive conditions that stray from the typical arrangements of the tax enactment.…”

“…In this regard, the government has embarked on formulation of policies and incentives that are meant to attract investors into the country. Investors are set to enjoy tax incentives yet another strategy to promote investment (Abdulla, Othman, & Hongzhong, 2012). Tax expenditure or tax incentive refers to tax revenue foregone due to tax deductions, tax exclusions, tax credits, and reduced tax rates for certain activities, industries, or taxpayers (Berger, & Rohaly, 2017).…”

Foreign Direct Investment - Growth Linkage in Sub-Saharan Africa: Is Governance a Mediating Factor?

“…The ubiquitous weak institutions and the rising concern for improved business environment mostly in developing countries offer considerable leverage for enhancing the effectiveness of institutional framework and International Journal of Business, Economics and Management public investment efficiency in these countries, especially in sub-Saharan Africa (SSA). Regarding the potential role of foreign direct investment (FDI) as the largest component of capital inflows and the key driver for investment growth in developing world (Dunning, 1994;Asiedu, 2002) many SSA countries have initiated a number of economic reforms in line with free trade and investment strategies -availability of tax incentives, simple regulatory system and provision of high-quality infrastructure, with the aim of attracting inward FDI (Abdulla et al, 2012). However, the region has not veritably experienced the dramatic increase in FDI inflows, as it only accounts for 3.4% share of global FDI in 2016, and no African country is in the list of the top 20 countries by inward FDI flows (UNCTAD, 2017).…”