FDI and Stability Somalia
Business & Governance

Investing in Stability: The Case for Somalia

Author(s): One Earth Future
Date: August 21, 2014
Publication Type: Policy Briefs
Research Topics: Business & Governance

Overview:

Research by Victor Odundo Owuor published as “Investing in Stability: The Case for Somalia” in the Business, Peace and Sustainable Development journal is the basis for this policy brief, and analyzes whether and how foreign direct investment (FDI) is linked to stability in a country ravaged by conflict and underdevelopment. The analysis is largely tied to the experience of sub-Saharan Africa with particular reference to Somalia. Motivating this analysis is the continued and growing interest in bringing investments and jobs to Somalia as part of international stabilization efforts. The research attempts to add clarity to the proposed link between foreign direct investment and stability by providing the audience of those likely to invest in Somalia with an informed and balanced discussion of planned intervention.

Key Findings:

Policy Implications:

  • Investors to Somalia should use lessons learned from countries neighboring Somalia as a constant point of reference.
  • Investors should factor in the risks, including those of policy reversals.
  • Openness to trade promotes FDI.
  • FDI in the region has predominately tended to be resource-based, with undesired effects.
  • Diaspora remittances continue to be an untapped resource.

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