The impact of foreign direct investment on economic growth: Iraq case study for the period (2004-2019)

The main aim of this study was to investigate and estimate the impact of foreign direct investment (FDI) on Iraqi economic growth that depending on data from 2004 to 2019. We determined Gross domestic product (GDP), an alternative to economic growth as a dependent variable. FDI inflows, and Oil Revenue are independent variables of this study obtained from World Bank various database resources. According to this research, the low-level FDI to GDP ratio for our study period is just 1.12% in 2012, a very modest ratio. FDI inflows grew dramatically with the passage of the Investment Law of 2006. In Iraq's economy, the oil and gas industry contributes the most to the government's budget. In addition, numerous tests such as unit root are used to evaluate GDP, FDI, and Oil Revenue, which are all stationary at the first difference and significant at 5%. The Johansen Cointegration tests were performed to examine the relationship between GDP, FDI, and Oil Revenue. We found that all variables are cointegrated, with a P-Value of 0.0001, indicating that the variables have a long-run relationship. Another finding according to least-squares revealed that the prob f-statistic 0.002516 was significant at 5% or lower, indicating that FDI and oil revenue have a positive impact on economic growth.