Macro Determinants of Foreign Direct Investment in Lebanon

This paper is concerned with identifying and analysing the impact of selected macroeconomic variables on foreign direct investment (FDI) in Lebanon. Toward this purpose, the analysis will be based on secondary data collected for the period standing between 1990 and 2018 to implement the Vector Auto Regression (VAR) and Error correction model (ECM) techniques. The results reveal that Gross Domestic Product (GDP), deposit interest rate and debt are correlated with FDI. While trade was found statistically an insignificant variable for FDI inflow. The findings of the study recommend that establishing and maintaining economic stability and growth will spurs foreign investments in Lebanon.