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Empirical literature on the impact of FDI on economic growth has been mixed. However some researchers are of the opinion that the inconclusiveness could be attributed to how FDI affects the various sectors of the Economy and not Growth as a whole. Therefore given that governments of developing economies including Ghana have been putting in place measures in order to attract FDI to stimulate economic growth, this study investigated the impact of FDI on economic growth and service sector value additions in Ghana. By employing the Johansen Cointegration technique, the study revealed FDI to have a positive significant impact on economic growth both in the long-run and short run and rather only a positive significant impact on the service sector in the short run.

FDI, Economic Growth and Service Sector Value Additions in Ghana