Exploring The Nexus Between Rule Of Law Advancements And Foreign Direct Investment In Ghana

The primary purpose of this thesis is to describe how the principle of the Rule of Law impacts the constitutional order’s ability to regulate Foreign Direct Investment(FDI).This thesis argued the notion that can there be regulatory involvement in increasing FDI throughput and we concluded that there was a substantial role played by the legislature.This was showed through the ability of policy to both attract and repel FDI,also major spikes in FDI can be attributed to legislative milestones,cementing the role of Rule of Law and the legislative bodies that draft it,in determining FDI.One major legal problem addressed in this thesis is whether constitutional frameworks are in place to govern FDI in Ghana,and how do they interact with the constitutional principle of the Rule of Law.This was addressed by highlighting the role of both regional and local agencies and also determining how they played a significant role in setting up treaties and trade agreements,exit and entry agreements,etc.All which has led to substantial gain in FDI as it appeals to entrepreneurship and capital.The outcome of this research concludes that the establishment of rule of law highly correlates with a positive trajectory in FDI inputs,excluding minor slumps within the margin of error.Ghana’s implementation of Rule of Law has had significant positive effects on its FDI portfolio and established a cause-and-effect relationship between the two.Once it was established,we analyzed legislative milestones and landmark rulings to validate volatility in FDI throughput both negatively and positively.This established the elasticity of FDI in Ghana and we used those economic metrics to recommend legislative directions that increase the likelihood of garnering more foreign funds.Also,most notably the major spikes in FDI investments can be attributed to landmark rulings and legislative revolutions cementing the notion that establishment of rule of law is the leading determinant of FDI throughput for the nation.Some other factors that are indirect results of the Rule of Law are also seen as determinants like the erection of impartial and independent institutions etc.The final results suggest four pillars of the Progressive Rule of Law as key determinants in FDI throughput and they are 1)Democratic law,2)Functional and independent institutions,3)Peaceful power transitions and electoral laws 4)Judicial independence and state losses in landmark rulings.These four determinants in particular had the highest response rate of FDI throughput although the exact causation of that can still be debated further.For these reasons Progression in Rule of law is a determinant of FDI and its throughput on FDI is significant.This thesis suggests reforms to address these issues based on prior government-led initiatives,notably the significant African Peer Review Mechanism(APRM)assessment finished by Ghana in 2006.None of these challenges ought to be too difficult.The effects of such laws on Ghana’s portfolio of foreign direct investments as well as the effects of each significant change in legal policy on the type,amount,and form of foreign investment in Ghana will then be examined as well.