Migration from developing economies and Greenfield Investment in European regions

The reduction in transportation and communication cost coupled with contemporary policy in conformity with global economic trends have led to geographic increases in the movement of people, goods, capital and knowledge across international boundaries. This has led to an increasing number of goods and services the world over. Existing literature indicates that there is a strong positive relationship between migration and FDI investment in the sense that, migrants in destination regions are able to use their networks to influence MNCs to invest in their home countries. This notwithstanding, the migratory rate is increasing steadily while FDI flows into Africa is stable and most often below the rate of migration. African governments have also not been able to place the necessary economic indicators to attracted the needed FDI into specific and most needed sectors of the economy. Migratory policies of most countries in Europe are friendly and welcoming to refugees and other vulnerable groups in society hence the increasing rate. Other factors such as structural differences, poverty and wage differences were identified as the major factors urging people to migrate. The main research question is to determine the extent immigrates from African countries in Europe use their network to influence greenfield investments in Africa? To this, the research used data from the UN Population Division, World Bank and FDI markets to analyze the data with the help of statistical softwares such as GIS, Excel, and STATA for the analysis. The research among other things concluded that immigrants from African countries in Europe use their network to influence greenfield investments in their originating countries. The results, however, suggest that, the correlation effect of migration on FDI is positive and that the effect remains significantly positive when adding GDP, total population, number of startup procedures, tax on export goods, cellular usage, inflation on consumer goods, and internet connective. However, this effect disappears when controlling for a number of taxes, days to import goods, forest rents, unemployment, infrastructure index and jobs created. In conclusion, therefore, the results suggest that, although there some mediating variables that influence migration and FDI, the general relationship between migration and FDI is significant.