The State of Foreign Direct Investment and its impact on urban development in Africa

The State of African Cities 2017 report seeks to evaluate the role of foreign direct investment as a possible major tool for financing urban development in African cities. To this end, an analysis has been done on the roles of current foreign direct investment (FDI) flows with a view to identifying the interventions required for promoting diversification, growth and resilience of African urban economies. The project focuses on urban employment generation, improving urban food, water and energy security, strengthening rural-urban linkages and promotion of infrastructures that can enhance regional economic cooperation, as well as review channels to increasing municipal revenue streams for strengthening local level governance capacities. The research project is being realised under a partnership between the African Development Bank (AfDB), UN-Habitat, the Department for International Development (DfID), the Institute for Housing and Urban Development Studies (IHS), The University of Witwatersrand and the OECD Development Center. The research entails an Africa wide overview of FDI patterns and in-depth empirical research on the economic impacts of FDI flows to selected African cities, with a view to providing policy advice on how to attract new and additional investment flows for sustainable urban development. Ultimately, well-guided FDI should generate employment, knowledge and technology transfers; establish and reinforce global supply chain linkages; and enhance access to world markets besides many other catalytic benefits such as investments in infrastructure and the development of human resources and skills through knowledge and technological transfers. The networking event will outline the preliminary research outcomes of the State of African Cities 2017report, including policy recommendations. It will stimulate debate amongst stakeholders on the impact of foreign direct investment on sustainable urban development and last but not least contribute to knowledge building around financing sustainable urban development in Africa.