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Vinsamlegast notið þetta auðkenni þegar þið vitnið til verksins eða tengið í það: http://hdl.handle.net/1946/17262


Foreign Direct Investment in Uganda and Rwanda; a Cross-Country Analysis

Janúar 2014

This thesis has been written to delineate motivational factors and country-related opportunities and constraints of foreign investors who run a subsidiary in Rwanda or Uganda with the intention of discussing why foreign entities are investing in either of the two countries and what market entry modes and strategies are used. This document’s results intend to help foreign enterprises in deciding why, how and where either of the two countries’ markets could be entered via FDI.
The first chapter contains the study’s objectives, its research questions and problem statement – which is: “if drivers exceed restraining forces, foreign entities choose Rwanda and/or Uganda as a destination for FDI”. The research questions give – inter alia – the fundament to investigate foreign companies’ extent of investment in Rwanda or Uganda. Furthermore, investors’ main drivers and the most important restraining factors are researched by asking – for instance – if enough resources can be found on the local markets. After chapter two highlights the most important theoretical foundations of the study, the thesis’ third chapter contains the document’s methodology. This section outlines the research’s approach, introduces the interview questions and explains that the study is of a qualitative nature. Specifically, ten foreign investors and one foreign organization are interviewed in Rwanda and 11 investors and two domestic specialists in Uganda. Chapter four introduces country-specific facts about the Republics of Rwanda and Uganda and reports the interviews’ results. In chapter five, the findings are compared with respect to the literature in order to indicate discrepancies and similarities. Most importantly, for foreign companies to successfully invest in a particular country they should possess company and country-specific advantages – such as access to inexpensive human resources, a favorable investment climate or a superior management. Consequently, chapter six outlines that Rwanda offers political stability and a comparatively good investment climate in which corruption tends to be relatively low. However, factors such as a highly political environment, the president’s succession in 2016 and the non-availability of sufficiently educated human resources contribute to a foreign enterprise’s potentially threatening forces. Similarly, the Republic of Uganda does not offer sufficiently educated workers and specialists. Furthermore, people’s minimalistic working attitude, the president’s succession in 2017 and comparatively high taxes are potentially constraining forces. Nevertheless, Uganda can be recommended as a destination for FDI since it offers a wide diversity of target groups, a developing economy, rising purchasing power, inexpensive labor and political stability.


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