Direct Foreign Investment in Jordan and its Effect on the Growth of the Real Domestic Product and the Levels of Unemployment and Export

Document Type : Original Article

Authors

Faculty of Princess Alia University Balqa Applied University Amman

Abstract

After the appearance of  the phenomenon of globalization, the world's entering in a free competition and deepening the participation in the global economy in a unified global economy, the need of the world countries to capitals to push the development in their weak economy has appeared and the competition among these countries to attract the direct foreign investment has increased as it has solutions to a lot of the complex problems of development .The countries exporting to investments were ready for this for many reasons such as :reducing the costs of production, the place diversity and exploiting the natural wealth. One of the countries which compete to attract the foreign investments is Jordan to the same previous reasons. This study has concentrated on the role of the direct foreign investments in raising the growth of the real local production, reducing the unemployment rates, increasing exports, thus reducing the shortage in the commercial scales . From this attitude, the direct foreign investment came to Jordan from different countries and also many investments have got out of Jordan to different countries through the period between 20052012 which shows that the flow of investments to Jordan is still unsatisfying despite the several motives to investment . It also shows that the direct foreign investment was of little effect on both growth rates in production and the rates of unemployment and the exports on the subordinate change (the size of the direct foreign investment) the study has reached a lot of results such as :the type of investment coming to Jordan doesn't create enough work chances and this investment is only intended for the local market  so it doesn't lead to the increase in exports remarkably .Also the size of investments doesn't affect the increase of economic growth greatly.

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