DOI: 10.11648/j.jfa.20241205.12 ISSN: 2330-7323

Key Determinates of Private Investment Performance Dire Dawa, Ethiopia

Betselot Ayal, Kassa Bekalu, Mulugeta Ayenalem
Show PDF Cite
Private investments are essential for Ethiopian economic success and growth. Despite government reforms aimed at fostering stability and growth, private investment continues to experience a downward trend characterized by volatility and unpredictability. Hence, the Primary objective of this study is to investigate the key determinants influencing the performance of private investment in Dire Dawa, Ethiopia. The study used a quantitative approach with an explanatory research design to analyze secondary time series data from 2012 to 2023 using SPSS. Descriptive and regression analyses were conducted. The main finding of the study indicates that private investment has a significant positive relationship with investment incentives, legal and political, credit facilities, corruption, and infrastructure. However, private investment development has a significant negative relationship with the loan interest rate. Except for the loan interest rate, the selected determinant factors can significantly positively affect the development of private investment in Dire Dawa City, but the loan interest rate has significant negative effects. Moreover, the regression analysis revealed that a combination of investment incentives, infrastructure, corruption, credit facilities, and loan interest rates collectively account for 74.4% of the variance in the outcome variables. Based on the study's findings, appropriate policy measures have been recommended.

More from our Archive