The Impact of Foreign Direct Investment on Economic Development in Uganda
Otim, Rachel (2024)
2024
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024120433104
https://urn.fi/URN:NBN:fi:amk-2024120433104
Tiivistelmä
Foreign direct investment (FDI) has played a critical role in fostering economic growth and development in developing nations, such as Uganda. It facilitates the transfer of capital, technology, and expertise, creating opportunities for infrastructure development, job creation, and industrial expansion. As a key element of globalization, Foreign Direct Investment has the potential to promote sustainable and equitable economic progress. However, its uneven distribution across regions and sectors often results in disparities in development outcomes.
This thesis studied the relationship between Foreign Direct Investment, economic development, and regional and sectoral disparities, guided by a strong theoretical framework. The study applied a mixed-methods approach, integrating qualitative data from a structured survey conducted with participants from various sectors and regions of Uganda and quantitative data sourced from organizations such as the World Bank and Uganda Investment Authority. The research examined the socio-economic impacts of Foreign Direct Investment on employment, infrastructure, income levels, and community well-being.
The findings indicated that FDI significantly contributed to income generation and infrastructure development, particularly in resource-intensive industries such as mining and oil. However, these benefits were concentrated in specific sectors and regions, notably the central and western areas, causing sectoral and regional inequalities. The underfunding of key sectors such as healthcare, education, and agriculture limited the broader developmental potential of Foreign Direct Investment. Additionally, environmental concerns associated with FDI projects emphasize the need for strong institutional and regulatory frameworks to ensure equitable and sustainable growth.
The thesis concluded by presenting policy recommendations to address these challenges. It emphasized the importance of equitable distribution of FDI benefits across sectors and regions and offered insights for policymakers, investors, and other stakeholders to maximize the advantages of FDI while minimizing its limitations, creating balanced and sustainable economic growth and development in Uganda.
This thesis studied the relationship between Foreign Direct Investment, economic development, and regional and sectoral disparities, guided by a strong theoretical framework. The study applied a mixed-methods approach, integrating qualitative data from a structured survey conducted with participants from various sectors and regions of Uganda and quantitative data sourced from organizations such as the World Bank and Uganda Investment Authority. The research examined the socio-economic impacts of Foreign Direct Investment on employment, infrastructure, income levels, and community well-being.
The findings indicated that FDI significantly contributed to income generation and infrastructure development, particularly in resource-intensive industries such as mining and oil. However, these benefits were concentrated in specific sectors and regions, notably the central and western areas, causing sectoral and regional inequalities. The underfunding of key sectors such as healthcare, education, and agriculture limited the broader developmental potential of Foreign Direct Investment. Additionally, environmental concerns associated with FDI projects emphasize the need for strong institutional and regulatory frameworks to ensure equitable and sustainable growth.
The thesis concluded by presenting policy recommendations to address these challenges. It emphasized the importance of equitable distribution of FDI benefits across sectors and regions and offered insights for policymakers, investors, and other stakeholders to maximize the advantages of FDI while minimizing its limitations, creating balanced and sustainable economic growth and development in Uganda.