The Mediating Role of Economic Openness on the Relationship between Foreign Direct Investment, and Economic Growth: A Case Study of Sudan (1980-2014)

Abstract

The purpose of this paper is to investigate the mediating role of economic openness (EO) on the relationship between, foreign direct investment (FDI) and economic growth (EG) in Sudan. The results of employing standard approach estimator shown that economic openness is partially mediate the relationship between FDI and economic growth during the period (1980-2014), FDI has no direct effect on output growth. Instead, the effect of FDI is depended on the degree of economic openness of Sudan. Therefore, Sudan government has to encourage economic policies, which eliminate foreign trade restrictions.