The impact of seaport infrastructure efficiency on foreign direct investment in Africa

The importance of foreign direct investment (FDI) in promoting economic growth, the transfer of technology and skill, among other benefits, and its crucial role in the achievement of other Sustainable Development Goals (SDGs) has been largely discussed in the literature. Given the importance of FDI and the desire of all economies to ameliorate the level of foreign direct investment, a growing literature has engaged in understanding its determinants. This study attempts to contribute to this literature by examining, for the first time, the impact of seaport infrastructure efficiency on FDI using data from 32 African countries over the period from 2018 to 2022. The system generalized method of moments estimation method was used for the analysis. The empirical results show that seaport infrastructure efficiency enhances FDI inflows in Africa. In addition, the crucial roles of economic growth, trade openness, exchange rate, information communication technology, urbanization, and regulatory quality are equally affirmed. Based on these findings, the study recommends port policies that promote seaport infrastructure efficiency in Africa.