Impact of Economic Growth and Trade Openness on Foreign Direct Investment: A Case of Pakistan

Abstract

Over the past three decades, global Foreign Direct Investment (FDI) has surged, indicating a profound shift towards economic globalization. FDI is pivotal in fostering interaction between nations, regions, and Multinational Corporations (MNCs), driving international trade, information exchange, and migration. Historically, FDI has spurred the development of host countries by enhancing infrastructure, technical expertise, and financial resources. South Africa emerges as a regional growth catalyst, channeling FDI to neighboring economies and bolstering technology transfer and human capital development. However, challenges persist, particularly in sectors vital to Pakistan's economic advancement, necessitating substantial investment. Understanding factors influencing cross-border investment decisions is imperative for sustainable growth.