THE IMPACT OF FOREIGN DIRECT INVESTMENT ON ECONOMIC GROWTH: THE CASE OF KYRGYZSTAN
DOI:
https://doi.org/10.52754/16948610_2025_4_15%20Keywords:
Foreign Direct Investment, Economic Growth, Kyrgyzstan, Granger Causality, Investment Policy, Investment ClimateAbstract
This paper analyzes the causal relationship between foreign direct investment (FDI) and economic growth in Kyrgyzstan using the Granger causality test. The study utilizes data for the period 1995–2024. The aim is to assess the significance of FDI as a factor stimulating economic growth and to examine the possibility of causal relationship between investment and growth. The results indicate that economic growth encourages the inflow of new investments, confirming a reverse relationship: an improved macroeconomic environment increases the country’s investment attractiveness. At the same time, the potential of FDI to stimulate growth is examined, allowing an evaluation of investment policy effectiveness and identification of priority areas for state support of investors. Based on the findings, practical recommendations are proposed for the development and improvement of Kyrgyzstan’s investment strategy, aimed at sustainable economic growth and creating a favorable investment climate. Particular attention is given to measures that promote the attraction of foreign investors and enhance the return on investments for the national economy.
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Кыргыз Республикасынын Улуттук статистика комитети https://stat.gov.kg
Дүйнөлүк банк https://data.worldbank.org/
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