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Implications of Foreign Capital Inflows on Manufacturing Sector in Third World Countries: A Nigerian Experience
Henry Onyebuchi Ejelonu,
Stanley Osinachi Okafor
Issue:
Volume 7, Issue 4, December 2022
Pages:
140-149
Received:
22 June 2022
Accepted:
8 July 2022
Published:
28 October 2022
DOI:
10.11648/j.ijafrm.20220704.11
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Abstract: As the world jostle for improved manufacturing and industrial technologies, third world countries in Africa, especially Nigeria still battles with the use of primitive tools in a technologically advancing world. This industrial bias in the country has led to abject poverty among the citizens, coupled with increasing tendencies of starvation, terrorism, banditry, kidnapping and youth unemployment being at 33% for the first quota of the year. To ameliorate this deficiencies and increase manufacturing sector performance in the economy, the government strives to achieve more foreign capital inflows in other to supplement the local production capacity. This study therefore aims to re-validate the implications this inflow has on local manufacturing sector in the country by re-assessing the implications of foreign capital inflows on manufacturing sector in third world countries: A Nigerian experience. Objectively the study is situated to examine the nexus between foreign portfolio investment, foreign direct investment and foreign development assistance with manufacturing sector productivity from 1981 to 2019, with statistical evidence obtained from central bank of Nigeria annual financial report for the year 2020. The study regressed for statistical stationarity of the variables using Augmented dickey and fuller test criterion, johansen test for cointegration to establish the nature of relationship between the parameter estimate in the model. Multiple regression analysis was carried out to substantiate the individual implications of the regressors on the regressed. Furthermore, the outcome of empirical evaluation is indicative of the existence of a short run relationship among the variables. It was likewise obtained that foreign direct investment (FDI) and exchange rate (EXCHR) were additively related to manufacturing sector productivity in Nigeria, while foreign portfolio investment (FPI) and interest rate (INTR) witnessed relative negative association ship with manufacturing productivity (MANU), which implies that a percent increase in the volume of foreign portfolio investment would equate 2.50% decline in local manufacturing capacity. The study recommended the adoption of endogenous growth model in Nigeria, while concluding based on theorization and argument against foreign capital inflows on its negative crowding out effect, it exerts on local industries in the country, that to achieve growth in the manufacturing sector, the country must evolve and begin a gradual industrial transition from primitive tools to the use of more advanced machines.
Abstract: As the world jostle for improved manufacturing and industrial technologies, third world countries in Africa, especially Nigeria still battles with the use of primitive tools in a technologically advancing world. This industrial bias in the country has led to abject poverty among the citizens, coupled with increasing tendencies of starvation, terror...
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The Effect of Key Audit Matters on Financial Information Quality: The Case of Tunisia
Khawla Hlel,
Ines Kahloul Nafti
Issue:
Volume 7, Issue 4, December 2022
Pages:
150-156
Received:
21 August 2022
Accepted:
13 September 2022
Published:
29 October 2022
DOI:
10.11648/j.ijafrm.20220704.12
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Abstract: This research investigates the impact of Key Audit Matters (KAM) on financial information quality in Tunisian firms. For this reason, we use 52 Tunisian firms for the period 2017-2020. Our GLS and GMM regressions indicate that, in agreement with the agency theory, external auditor has an effective role, as an instrument of monitoring, to prohibit the opportunistic activities of managers. It supervises the manager’s behavior by the disclosure of KAM. Hence, it serves as a crucial tool that contributes to improve financial information quality and to decrease information asymmetry. In addition, it is considered as an important mechanism for preserving trust in financial reporting and integrity of financial information. This study is important for potential investors who should assess KAM when evaluating firms. Furthermore, our results will be useful to companies because they provide evidence that the external auditor can effectively reduce managerial opportunistic behavior and enhance information quality. Finally, they could encourage audit regulators to ameliorate the audit standards.
Abstract: This research investigates the impact of Key Audit Matters (KAM) on financial information quality in Tunisian firms. For this reason, we use 52 Tunisian firms for the period 2017-2020. Our GLS and GMM regressions indicate that, in agreement with the agency theory, external auditor has an effective role, as an instrument of monitoring, to prohibit t...
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Deterrents of Access to Debt Capital for Small and Medium Enterprises in Nairobi
Issue:
Volume 7, Issue 4, December 2022
Pages:
157-163
Received:
15 November 2022
Accepted:
5 December 2022
Published:
15 December 2022
DOI:
10.11648/j.ijafrm.20220704.13
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Abstract: Since thirties access to debt capital has been considered as one of the main challenges facing the growth of Small businesses in the world. Empirical studies in developed countries focused on access to debt capital without considering the cost of that debt, due to the fact that the cost of debt is cheaper in developed countries. However, this is not the case in the developing economies such as Kenya due to lack of financial transparency, high interest rate, high risk, and poor financial reporting. This study endeavored to investigate the hindrance of small businesses to access debt capital in Nairobi, Kenya. In addition, the study used loan-pricing theory (LPT) to clarify the theoretical explanation of factors that hinder Kenyan SMEs to access debt capital. Factors that this study investigated are: cost of debt (CD), faith prohibition (FP), and long process (LP). The study applied regression and correlation to analyze the collected data using SPSS. The analysis revealed significant relationship between cost of debt and access to debt capital. There was also significant relationship between long process and access to debt capital. But the relationship between faith prohibition and access to debt capital was insignificant. The study concluded that the government should facilitate cheap finances for small businesses to enable them access to debt capital and improve their performance. Developing online loan facilities should reduce the long process and sizeable paper work of accessing debt capital. The government should connect the grid to small businesses and encourage virtual lenders to lend out a sizable portion of their credits.
Abstract: Since thirties access to debt capital has been considered as one of the main challenges facing the growth of Small businesses in the world. Empirical studies in developed countries focused on access to debt capital without considering the cost of that debt, due to the fact that the cost of debt is cheaper in developed countries. However, this is no...
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Private Equity and Factors Limiting Its Contribution to Economic Growth in Zambia
Evaristo Chanda,
Shem Sikombe
Issue:
Volume 7, Issue 4, December 2022
Pages:
164-173
Received:
25 September 2022
Accepted:
21 November 2022
Published:
27 December 2022
DOI:
10.11648/j.ijafrm.20220704.14
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Abstract: Private equity (PE) is recognized globally as a key driver of economic growth. Apart from providing capital to businesses, PE provides the expertise needed for their growth. Despite its great potential, the PE industry continues to struggle, especially in developing countries like Zambia. The aim of this study was to establish factors limiting PE contribution to economic growth in Zambia. The study was qualitative in nature and targeted fund managers at both local and international PE firms. An online open – ended questionnaire was used to collect data from respondents. 13 fund managers from 11 PE firms (Both local and international) agreed to take part in the study. 13 questionnaires were filled out and submitted. The collected data was analyzed by identifying common themes in the participants’ responses and conclusions drawn with the guidance of the research questions. The study found that the Zambian PE industry contributes to economic growth through creation of new jobs, fostering innovation, tax contributions and helping companies grow. The study also revealed that the PE industry is still underdeveloped despite the country having great investment opportunities in sectors like tourism, agriculture, healthcare, manufacturing and retail. The main challenges facing PE identified in the study include the immature regulatory framework, underdeveloped PE culture, currency risk, limited investment opportunities and exit challenges. In conclusion, the study has noted that the Zambian PE industry is still underdeveloped and faces a lot of challenges. The study recommends raising awareness of PE among local businesses and other key PE players through educational campaigns.
Abstract: Private equity (PE) is recognized globally as a key driver of economic growth. Apart from providing capital to businesses, PE provides the expertise needed for their growth. Despite its great potential, the PE industry continues to struggle, especially in developing countries like Zambia. The aim of this study was to establish factors limiting PE c...
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Impact of Sustainable Livelihood Assets on Improving Household Income in Zanzibar: A Case Study of North a District
Asma Ali Abeid,
Abdalla Ussi Hamad,
Salama Yusuf
Issue:
Volume 7, Issue 4, December 2022
Pages:
174-180
Received:
14 November 2022
Accepted:
8 December 2022
Published:
27 December 2022
DOI:
10.11648/j.ijafrm.20220704.15
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Abstract: This study examines the impact of sustainable livelihood assets (SLAs) on improving a household income in Zanzibar: a case study of North A district. Specifically, the study examines the impact of financial capital on improving household income, impact of social capital in improving household income, impact of human capital on improving household income and impact of physical capital on improving household income in Zanzibar especially North A district. The researcher has mainly employed quantitative research approach with appropriate method of analysis for this study. The sample size for this study consists of 395 respondents and survey questionnaire was used as data collection instrument. To achieve a credible study a Multiple regression analysis was used to analyses the collected data from relevant respondents. At the 0.05 level of confidence, the study has revealed that four predictors (physical capital, financial capital, human capital and social capital) had a significant effect or impact on the outcome variable (household income improvement). The study concluded that household who show or have high level of physical capital, financial capital, human capital and social capital tend to improve their income easily. Finally, the study recommended that the head of households should increase their livelihood assets by educating the younger members of the households on the important of acquiring sustainable livelihood assets in their lives.
Abstract: This study examines the impact of sustainable livelihood assets (SLAs) on improving a household income in Zanzibar: a case study of North A district. Specifically, the study examines the impact of financial capital on improving household income, impact of social capital in improving household income, impact of human capital on improving household i...
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Effect of Consumers Perceived Risk on Online Purchasing Intention in Zanzibar: A Case of JUBIWADA
Subira Abdalla Maisara,
Abdalla Ussi Hamad,
Salama Yusuf
Issue:
Volume 7, Issue 4, December 2022
Pages:
181-187
Received:
22 November 2022
Accepted:
10 December 2022
Published:
27 December 2022
DOI:
10.11648/j.ijafrm.20220704.16
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Abstract: This study examines the effect of consumers’ perceived risk on online purchasing intention at JUBIWADA Zanzibar. Specifically, the study examines the effect of consumers’ financial risk, time risk and social risk online purchasing intention. The researcher has mainly employed quantitative research approach with appropriate method of analysis for this study. The sample size for this study consists of 321 respondents using simple random sampling technique and survey questionnaire was used as data collection instrument. To achieve a reliable result a Standard Multiple regression was used to analyses the collected data from relevant respondents. The study has revealed that three predictors (social risk, time risk and financial risk) had a significant effect or impact on the outcome variable (online purchase intention). Essentially, the effects of these risks to online purchase intention were in a negative direction. This situation indicates that the increase of scores in these predictor variables results in degrease of scores in the outcome variable. The study concluded that customers who show or have high level of perceived risk (social risk, time risk and financial risk) tend to reduce their intention to purchase online products. Finally, the study recommended that the management of JUBIWADA may encourage online purchasing by solving the problem social risk, time risk and financial risk in the business environment.
Abstract: This study examines the effect of consumers’ perceived risk on online purchasing intention at JUBIWADA Zanzibar. Specifically, the study examines the effect of consumers’ financial risk, time risk and social risk online purchasing intention. The researcher has mainly employed quantitative research approach with appropriate method of analysis for th...
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