Foreign direct investment is nowadays seen as an important factor of growing the economy. In fact, it brings to a country not only the needed capital, but also advanced technology, employment, taxes for government etc. Mindful of its importance, in 1994, eight west African countries have decided to come together in creating an economic and monetary union which could help to prime their development by attracting more foreign capital.
Regarding its importance for such countries where the national savings are low, it is necessary to investigate what are the main factors that make this union attractive to foreign investors. Hence, this thesis analyzes the determinants of foreign direct investments in the west African economic and monetary union between 1996 and 2015. In that purpose, thirteen variables have been identified as possible determinants and data have been collected from the world bank, the United Nations Conference on Trade and Development (UNCTAD) and the Global Economy databases to build an empirical model.
The study is based on panel data analysis since we aim to identify FDI’s determinants both on the spatial and temporal dimensions. And among the different models to tackle the panel analysis, the random effect model is used because heterogeneity specification test suggests that this model is more suitable for our study.
From our empirical results, it turns out that only the market growth is not statistically significant. FDI inflow is sensitive to all the other variables. It also shows that the relationship between FDI, inflation and natural resources is a weak (10% significance level)

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