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Implications of China in Kenya
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Class of 2022
Major:
International Economics – Multi–Language
Minor:
Statistics

Her name is Shiru Kimani and she is a junior planning to graduate in May 2022. She is majoring in International Economics and Multilanguage with a minor in Statistiscs. Her passions are networking and indulging in all the cultures of the world. In this project, Shiru wanted to combine her interests in learning about her Kenyan origin and love for world economic relations. She is looking forward to expanding this project in her senior year.

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Description

Food Security is an urgency in developing countries. Africa is the leading continent with the highest level of severe food insecurity. In recent years, Kenya has been a prime example of a benefactor of foreign direct investment (FDI). How does foreign direct investment inflows affect host countries’ food security? Research on modernization and dependency theories offer debate on the multilateral effect of FDI. I expand on these theories by examining the effect of the three sectors in FDI pertaining to: natural resources, manufacturing goods and industry-specific services. I use China, as a developed country of focus, because of their historic success in economic growth. I test my arguments using food security indicators from Food and Agriculture Organization (FAO) database. I find highly robust evidence that industry specific FDI improves food security. I also find that secondary FDI of manufacturing goods hinder food security. The robust evidence resulted from multiple control variables, statistical methods, and previous economic research. This research offers, extended knowledge on food security, Kenya’s economy, and Chinese outward investments. It also demonstrates how to resolve long lasting controversial theories on the implications of FDI.