| 摘要: | The objective of this study is to explore the impact of government policies on foreign direct investment (FDI); the case of Sao Tome and Principe Island. FDI has been playing an important role in the global economic growth and prosperity both in developing and developed world. Sao Tome and Principe is a small Island State and one of the smallest economies in the world and has been highly dependent on loans from foreign aids, since its independence on July 12, 1975. To worsen the situation, FDI inflow to the country is very low and has decreased since 2011. This study was guided by two research questions, which are: (1) what are the factors in government policies that have hindered FDI in STP? (2) What are the solutions to increasing FDI inflow in STP? To answer these questions, qualitative research methods consisting of documentary analysis and in-depth interviews was conducted. A sample of twelve interviewees was selected consisting of six high government officials setting the FDI policies as well as six executives of foreign companies operating in STP. The interview took place in Sao Tome and Principe from the period of August 2016. The documentary and interview data were analyzed through thematic analysis and triangulated. The study findings concluded that the most important barriers, obstacles or disincentives to FDI in Sao Tome and Principe, according to their order of importance are a lack of quality infrastructure, inadequate power supply, poor investment climate, lack of tax incentives, political and macroeconomic instability, higher transportation cost, and monetary policies concerning to the money supply. Further, the study concluded that the government must to improve the sectors of infrastructure, Central Administration, monetary policies, health, justice and education system, human resources, tourism, agriculture and legislative to improve STP business environment. |
