•   Manuel Fernandez

  •   Odai Mohannad Refai Suleiman

  •   Sereen Najati Mahmoud Yaseen


Globalization has made worldwide mobility of money extremely easy. The investors prefer to invest in places that offer attractive returns and are relatively less risky. The inflow of FDI gives developing countries access to capital that would otherwise not be available. FDI also provides much needed foreign exchange and therefore helps to adjust some of the macroeconomic imbalances in developing countries.  Jordan is in the growth mode, but the resources available is limited and very often insufficient, hence they are also in the race to attract international investments.  The main objectives of this study are to find out the status of Jordan as a destination for FDI, the factors that attracts FDI into Jordan, and the factors that hinder the flow of FDI into Jordan. This study is based on secondary data and covers a period of five years.  The study analysis various determinants of FDI like market size, economic growth, infrastructure, political risk, corruption, labor market, raw materials, technological readiness, innovation, financial system, taxation, cost of capital and ease of doing business. The study reveals that Jordan’s position in the global FDI map is on the decline and most of its rankings by global agencies are dropping year after year. 

Keywords: Foreign Direct Investment; Investor-friendly; Transnational Corporations


M. Fernandez, and R. Joseph, “Qatar emerging as the most attractive FDI destination in the GCC”, International Journal of Economics and Finance, vol.8, no.11, pp.175-192, 2016.

World Investment Report. (2019). Available: http://unctad.org/en/PublicationsLibrary/wir2019_en.pdf

J. W. Cho, “Foreign direct investment: determinants, trends in flows and promotion policies”, Investment Promotion and Enterprise Development Bulletin for Asia and the Pacific, vol.1, pp. 99-112, 2003.

M.S. Oudat, A.A. Alsmadi, and N.M. Alrawashdeh, “Foreign direct investment and economic growth in Jordan: an empirical investigation using the cointegration limits test”, Finance and Economic Policy Magazine, vol. 11, no. 1, pp. 55-63, 2019. Available: https://doi.org/10.14718/revfinanzpolitecon.2019.11.1.4

A.A. Alsmadi, and M.S. Oudat, “The effect of foreign direct investment on financial development: Empirical evidence from Bahrain”, Ekonomski Pregled, vol. 70 no. 1, pp. 22-40, 2019.

S. Bhattacheryay, “Foreign direct investment in India opportunities and challenges”. International Journal of Asian Business and Information Management, vol.9, no. 4, pp.1-20, 2018.

OECD, “Main determinants of FDI and its impact of foreign direct investment on China’s economy”, working papers on international investment no. 4, prepared for OECD cooperation programme, 2000.

P. Xaypanya, P. Rangkakulnuwat, and S.W. Paweenawat, “The determinants of foreign direct investment in ASEAN”, International Journal of Social Economics, vol.42, no.3, pp. 239-250, 2015.

A.Q. Khachoo, and M.I. Khan, “Determinants of FDI inflows to developing countries: a panel data analysis”, 2012.

R. Gedam, Determinants of FDI and India’s experience: Economic Reforms in India, 2nd ed. Deep and Deep Publication, 1996, pp. 82-100.

F.R. Root, and A.A. Ahmed, “Empirical determinants of manufacturing direct foreign investment in developing countries”, Economic Development and Cultural Change, vol. 27, no. 4, pp. 751-767, 1979.

F. Schneider, and B.S. Frey, “Economic and political determinants of foreign direct investment”, World Development, vol. 13, no. 2, pp. 161-175, 1985.

C. Chopra, Foreign investment in India, 1st ed. Deep and Deep Publication, New Delhi, 2003, pp 34–45.

Neumayer, Eric, and Indra, Soysa, "Trade openness, Foreign direct investment and Child labor", World Development, vol. 33, no. 1, pp. 43-63, 2005

H.V. Milner, "Introduction: The global economy, FDI, and the regime for investment", World Politics, vol. 66, no.1, pp. 1-11, 2014.

Global Competitiveness Report (2019). Available: https://www.weforum.org/reports/how-to-end-a-decade-of-lost-productivity growth.

J.H. Dunning, “The determinants of international production”, Oxford Economic Papers, vol. 25, no. 3, pp. 289-336, 1973.

A. Chandalert, “The Determinants of U.S. direct investment in Thailand: A survey on managerial perspectives”, Multinational Business Review, vol. 8 no. 2, pp. 82-88, 2000.

Richard. E. Caves, “International corporations: The industrial economics of foreign investment”, Economica, vol. 35 no. 141, pp. 1-27, 1971.

H. Zhao, and G. Zhu, “Location factors and country-of-origin differences: An empirical analysis of FDI in China”, Multinational Business Review, vol. 8, no. 1, pp. 60-73, 2000.

WEF Report 2019. International Monetary Fund, World Economic Outlook Database, October 2019. Available: https://www.imf.org/external/pubs/ft/weo/2019/02/weodata/index.aspx

M. Obstfeld, and R. Duval, “Tight monetary policy is not the answer to weak productivity growth”, 2018. Available: https://voxeu.org/article/tight-monetary-policy-not-answer-weak-productivity-growth.

M. Fernandez, A.M. Shubaisi, and R. Joseph, “Examination of potentialities of Vietnam as FDI destination”, Journal of Economics and Business, vol.3, no.3, pp. 980-994, 2020.

Business and economic data for 200 countries. Available: https://www.theglobaleconomy.com/download-data.php.

Logistics Performance Index, (2018). Available: http://lpi.worldbank.org/international/global

Agility Emerging Markets Logistics Index (2020). Available: https://www.agility.com/insights/emerging-markets-logistics-index/rankings/

S. Brakman, and H. Garretsen, Foreign direct investment and the multinational enterprise, MIT Press, 2008.

Credendo Group index reports. Available: https://www.credendo.com/country-risk

Transparency International, the Corruption Perceptions Index. Available at: http://www.transparency.org

The Central Bank of Jordan. Available: https://www.cbj.gov.jo/

KPMG data. Available: https://home.kpmg/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/corporate-tax-rates-table.html

KPMG data. Available: https://home.kpmg/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/individual-income-tax-rates-table.html

Global Innovation Index (2019). Available: https://www.globalinnovationindex.org/content/page/data-analysis/

Doing business global ranking (2020). Available: http://www.doingbusiness.org/rankings.


Download data is not yet available.


How to Cite
Fernandez, M., Suleiman, O. M., & Yaseen, S. (2020). Review of Foreign Direct Investment in Jordan. European Journal of Business and Management Research, 5(4). https://doi.org/10.24018/ejbmr.2020.5.4.408