Written by
Chisom Ogbunando and Ifechukwu Ewulum
Abstract:
Addressing the issue of climate change and its impact in today’s world is now of pre-eminence priority for many investors looking to expand or relocate their business in developing countries in the post-pandemic era.
Expectedly, these effects on one hand have the potential of improving standards of production while achieving net zero buildings by funding green technology campaigns and transferring outdated technology that emits higher levels of carbons, methane and dangerous gaseous matter on the other hand. This negative impact can be attributed to lax environmental regulations and non-compliance of the same by multinational enterprises.
Fortified with the relevant literature, this research distils the concepts of Foreign Direct Investment (FDI) and environmental sustainability highlighting the rationale behind the concepts and examining the determinants that drive FDI inflow into Africa.
Whilst appreciating the role of FDI on the health of the environment, it finds that FDI activities in host communities have positive and negative impacts on the environment.
Progressively, this study recommends that the legal framework for environmental regulation be strengthened, enforced and complied with. This will help developing countries keep track of FDI in their communities, discourage all pollutant machinery, and encourage the adoption of clean technology to maintain a sustainable environment.
With the aid of the doctrinal research methodology, this research adopts qualitative, descriptive and analytical research methods while the research data are primarily from secondary sources. These include journal articles, books on the relevant subject matter, working papers, periodicals, reports and, the writings of qualified columnists as seen in economic and business websites and other online sources.
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The Role of Foreign Direct Investment in Environmental Sustainability in Africa