ECONOMIC GROWTH AND FOREIGN DIRECT INVESTMENT (FDI) INFLOW: HOW RELEVANT ARE THE INDICATORS OF DEPENDENCE IN THE CASE OF KAZAKHSTAN?

Purpose of the study is to answer the following research questions: (1) what knowledge about the processes and the status of a particular economy gives the fact of the presence (absence) of dependence between the indicators of FDI inflow and the dynamics of GDP? (2) If there is a positive correlation between FDI inflow and GDP growth, is this a positive development for the economy of a particular country, especially for its real sector? And if so, how to measure and check it in the case of Kazakhstan? (A similar question can also be formulated regarding negative correlation.)
Research methods – General scientific methods of analysis and synthesis, statistical and graphical methods, regression and correlation analysis have been applied.
Novelty / value – Kazakhstan's economy has been experiencing a significant FDI inflow for more than a decade, but the real results (effects) of this process have not been sufficiently studied. The author considers the effects of FDI inflow into the economy of Kazakhstan in terms of their impact not only on GDP dynamics, but also attempts to understand what other indicators to be investigated to create a realistic picture of the role of FDI in the economy and, first of all, in its real sector.
Conclusions – As a result of the study the author derives the following assumptions: (1) In the case of Kazakhstan the hypothesis of a positive correlation between FDI inflow and economic growth is not confirmed; (2) GDP itself is not informative in the case of the small commodity production - concentrated economy of Kazakhstan, where a high volume of FDI inflow is accompanied by high volumes of foreign investor`s income withdrawal. More adequate for the analysis in this case is GNI, which is equal to GDP minus net factor income (NFI), that includes income from FDI; (3) Methodological approaches based on the analysis of GDP dynamics may are considered not relevant for the study of the impact of FDI to the economy of Kazakhstan; (4) After 15 years of FDI inflow the main effect to the real sector of the economy of Kazakhstan is the growth of crude oil production, which is confirmed by the results of correlation and regression analysis.

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