Exploring Foreign Direct Investment for Human Resources Development in Developing Countries — A Case Study of Shandong Iron and Steel Group in Sierra Leone

Abstract

Inviting foreign companies to set up factories in host countries not only helps improve the local economy, but it also helps to develop local manpower. This is because most foreign companies tend to bring in their own specialists who end up training the local workers specific new skills that end up upgrading the human resources capacity and hence the economy of the host countries. This has the potential to build Foreign Direct Investment (FDI) into an influential element for the development of Human Resource Management (HRM) of the host countries. This is especially true for developing economies where HRM is still rudimentary. Also, income generated from FDI can enhance the proper functioning of HRM that will in turn drive organizations to achieve set production goals. Qualified foreign Human Resource Experts (HRE) have the responsibility to hire and train local workers on improving job outputs. Thus, by focusing not only on theories, but also practical applications of HRM in Sierra Leone, this paper analyzed the role of foreign companies, especially Chinese companies, in economic development in Sierra Leone. The paper discussed the challenges foreign companies face in Sierra Leone, where HRM is still rudimentary. It put forward practicable solutions towards such problems in the hope that the stakeholders and decision-makers in the country can begin to look at FDI as an integral element for the human, socio-economic and cultural development of the country.