Acta Universitatis Danubius. Œconomica, Vol 14, No 6 (2018)

Abstract

The Foreign Direct Investment-Exports nexus has been widely researched, however despite evidence of the bi-directional relationship, little is known about the reverse Exports-Foreign Direct Investment relationship. Thus, the study intended examine the influence of Zimbabwe’s Exports profile on the FDI decisions of foreign investors. The study set out to identify the export factors constituting Zimbabwe’s Exports profile and then test the relationship between Zimbabwe’s Exports profile and the four foreign direct investment market opportunity types. STATISTICA 2016 was utilised to apply Exploratory Factor Analysis, Principle Component Analysis and Multiple Regression to analyse the quantitative data generated from a purposive sample of n=305 foreign investors. Factors such as the existing global demand for Zimbabwe’s export products, and the export processing zone status allocation to foreign manufacturers in Zimbabwe were found to be some of the quite influential factors to foreign direct investment market entry motives. Importantly, the results indicate discernible statistically significant relationships between Zimbabwe’s Exports profile and market-, resource-, efficiency-, and strategic asset-seeking market opportunities. Thus, this study is novel, providing valuable insights into the Exports profile-Foreign Direct Investment nexus – significantly contributing to the extent of the literature within the foreign direct investment and behavioural economics discourses.