Trade Openness and Private Investment in Ghana

Abstract

The study seeks to examine the trade openness-private investment nexus in Ghana. It adopted Autoregressive Distributed Lag (ARDL) Bound testing cointegration technique to examine the correlation between trade openness and private investment in Ghana. The findings of the study are as follows: there is a long- run correlation between trade openness and private investment in Ghana, there is short- run correlation between trade openness and private investment in Ghana. And there is unicausality running from private investment to trade openness in Ghana. The study therefore recommends that the policies in Ghana should be directed towards strengthen trade openness in Ghana such as easiness in commencement and running of business, taxes should be minimal, labour law should favour investors as well as lower duties on import and export in order to increase private investment in Ghana