Determinants of American foreign direct investments in Iraq

The purpose of this concurrent mixed methods study was to explore the Government of Iraq readiness and the criteria MNCs use to invest in Iraq. Current governance practices and the geopolitical risks surrounding the host nation are factors that determine the levels of American foreign investments. Quantitative survey participants consisted of 184 American armed forces Iraqi veterans and Department of Defense contractors who deployed to Iraq between 2003 and 2011. Qualitative participants comprised of 13 U.S. military leaders who provided their opinions and perceptions toward possible American investments in Iraq. The lived experiences of survey participants helped in answering 8 research questions and supported testing 5 hypotheses. The findings of the study revealed that the Government of Iraq could increase FDI levels by improving security, fighting corruption, increasing transparencies, and refining governance. Results also revealed that 76.93% believed that American MNCs should not invest in Iraq. The five tested hypotheses revealed a significance relationship between public governance, geopolitical risks, investments’ recommendations, short-term investments, long-term investments, and investments’ levels in Iraq. Logarithmic transformation of data was necessary in adjusting the data to follow the lognormal distribution. Triangulation of results between qualitative and quantitative data validated the outcomes in this study. Implications for MNCs leaders included implementing the Foreign Corruption Practices Act, hiring locals, starting with little capital on the short term, and scaling up investments on the long run. The majority of the qualitative participants recommended investing primarily in the oil industry. Recommendations for future research included obtaining Iraqi-generated economic data and surveying MNCs leaders currently investing in Iraq.