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Effects of foreign direct investment in African agriculture

Don Gunasekera (Institute for Supply Chain and Logistics, Victoria University, Melbourne, Australia)
Yiyong Cai (Commonwealth Scientific and Industrial Research Organisation, Canberra, Australia)
David Newth (Commonwealth Scientific and Industrial Research Organisation, Canberra, Australia)

China Agricultural Economic Review

ISSN: 1756-137X

Article publication date: 5 May 2015

Abstract

Purpose

The purpose of this paper is to review the key issues surrounding foreign direct investment (FDI) in agriculture, and examine the potential impacts of FDI in African agriculture.

Design/methodology/approach

The dynamic Global Trade Analysis Project model (GDyn) is used to analyse the potential impacts of improvements in land productivity and FDI in Africa.

Findings

The results illustrate that combined efforts to improve land productivity and growth in FDI could potentially increase Africa’s share in global agricultural output and exports, particularly with respect to oil seeds, sugar, and cotton.

Originality/value

The authors employ a global economy-wide modelling framework to simulate the effects of growth in FDI in African agriculture.

Keywords

Acknowledgements

JEL Classification — F1, F2, Q1, C68

The authors acknowledge support from the University of Adelaide, based on a Rural Industry Research and Development Corporation funded project. The authors wish to thank two anonymous reviewers for their valuable comments and suggestions. Kym Anderson and Ernesto Valenzuela provided useful comments on earlier drafts of this paper.

Citation

Gunasekera, D., Cai, Y. and Newth, D. (2015), "Effects of foreign direct investment in African agriculture", China Agricultural Economic Review, Vol. 7 No. 2, pp. 167-184. https://doi.org/10.1108/CAER-08-2014-0080

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited