The effects of foreign direct investments on export performance in Central Asian countries

Abstract

It is recognized in the economic literature that foreign direct investment (FDI) has many potential impacts
on countries. These include; FDI’s capital, production and management knowledge will bring new
technologies, increase competitiveness and productivity in the national industry, increase the amount
of low-cost and high-quality products, facilitate trade in goods and services, positively affect export
performance, accelerate economic growth and positively contribute to employment. It can be deemed
to contribute. For this reason, countries try to attract investment from foreign countries by improving
the investment climate in order to benefit from foreign direct investments. In this context, Central Asian
countries (Kazakhstan, Kyrgyz Republic, Turkmenistan, Tajikistan and Uzbekistan) have started to implement
various reforms and incentive policies to attract foreign capital after gaining their independence.
The main purpose of this study is to investigate the effect of foreign direct investments directed towards
Central Asian countries on exports, with reference to the effects of foreign direct investments on international
trade. For this purpose, it has been tested with the panel data method using the quarter data of the
Central Asian countries for the period 2000-2019. The study is expected to contribute to the economics
literature on Central Asian countries.
Key words: foreign direct investment, Central Asian countries, exports, panel data analysis.