Integrating Liberal Economic Regulation with Environmental Protection: Ethiopia, Zambia, Mali and Ghana

Abstract

Foreign investors and host African countries have a tied interest in the economy. The interaction of foreign direct investment (FDI) and the environment impacts on the natural world and the population in no small measure. As the interaction evolves, other factors, such as human rights, sustainable development and resource management also begin to shape economic activities. Their impact depends on the regulations and policies of recipient countries. Some researchers believe that the inflow of FDI makes government tighten its environmental regulation and policies, but such a finding is too generalised. The increase in global environmental consciousness shows that relaxed environmental policies have been part of the incentives for attracting FDI into Africa in past years. This paper focuses on how the regulations and policies of selected African countries influence their position in international investment agreements and how such agreements affect environmental laws. A sub-regional policy template is needed that will guide members of regional economic blocs like ECOWAS in framing balanced policies for the environment and FDI.