| Author's Name: |
Clainos Chidoko and Rose Constancia Sakuhuni |
| Subject Area: |
Social Science and Humanities |
| Subject |
Economics |
| Section |
Research Paper |
Keyword:
Foreign Direct Investments, Balance of Payments, Current Account, Capital Account, Investment, Exports, Unilateral Transfers
Abstract
The study investigates the impact of foreign direct investment on Zimbabwe’s balance of payments for the period 1981-2013. The study utilises a linear model that takes foreign direct investment, the current and capital accounts as explanatory variables, while the balance of payments is the dependant variable. The study found out that foreign direct investment, current and capital accounts have significant influence on the balance of payments of Zimbabwe. The conclusion is that foreign direct investment has a huge impact on the balance of payments. The study recommends the government to create a conducive investment environment to attract foreign direct investment into the domestic industries. It should also aim to make its exports more competitive in the global market through measures such as value addition and generally cheaper prices.