The Analysis of the Major Determinants of Foreign Direct Investment: Case of Tanzania

Abstract

This paper analyses the determinants of foreign direct investment in Tanzania. Using Ordinary least square (OLS) estimation technique to analyze the relationship, result shows that the market size, infrastructure development and natural resources availability are the major determinants of foreign direct investment inflow to Tanzania. It is recommended that, Tanzania government need to make more effort in the expansion of the market that will attract more FDI. More investigations are needed on the infrastructure development to encourage more FDI to the country. More exploration of natural resources is necessary to ensure its availability for example the new recent massive discovery of gas in the country might have a big impact on attracting FDI in the near future