Exploring Economic Growth Determinants in Developing Countries of Asia and Africa
DOI:
https://doi.org/10.56225/finbe.v2i2.221Keywords:
economic growth, exports, exchange rates, foreign direct investment, government spending, human development index, Asia – AfricaAbstract
Asian and African regions have experienced periods of economic growth, yet they continue to grapple with distinct challenges and issues that hinder their ability to sustain and distribute that growth effectively. In addressing this concern, our research investigates the impact of exports, exchange rates, foreign direct investment, bank credit, government spending, and the Human Development Index on the economic growth of developing nations in Asia and Africa. The employed methodology is the panel least square method, which utilizes secondary data. The Asian region comprises 28 countries, and Africa encompasses 34 countries, from 1946 to 2018. The outcomes of the study reveal that within developing Asian countries, variables such as exports, exchange rates, foreign direct investment, bank credit, government spending, and the Human Development Index have positive and noteworthy effects on economic growth. In the context of African nations, the research finds that exports, exchange rates, and government spending have favorable and significant impacts. However, the Human Development Index displays a detrimental and significant influence. On the other hand, foreign direct investment and bank credit exhibit positive yet inconsequential effects on economic growth in developing African countries. Consequently, these findings underscore the need for robust macroeconomic foundations in developing economies to counteract global economic uncertainties. This strategy is imperative to facilitate swift economic expansion that aligns with each nation's distinctive economic development plans.
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