Determinants Of Foreign Direct Investment In Chad: The Influence Of Selected National Culture Dimensions, Human Capital, Stakeholder Intervention, And Infrastructure Development

Abstract

Chad has struggled to attract substantial Foreign Direct Investment (FDI) inflows due to challenges such as limited human capital, poor infrastructure, and weak policy transparency. Despite these barriers, limited research has examined the cultural dimensions influencing FDI in this context. This study investigates the effect of human capital, stakeholder intervention, and infrastructure development on FDI attraction in Chad, with a focus on the mediating role of Hofstede’s national culture dimensions (power distance, individualism vs. collectivism, and uncertainty avoidance). Using quantitative research design, data were collected from 417 top management personnel of international companies operating in N’Djamena and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results revealed that stakeholder intervention and infrastructure development have significant and positive effects on FDI attraction, while human capital showed no significant effect. Furthermore, power distance, individualism vs. collectivism, and uncertainty avoidance mediated the relationship between infrastructure development and FDI attraction. Power distance and individualism vs. collectivism also mediated the relationship between human capital and FDI attraction, whereas only power distance mediated the effect of stakeholder intervention. These findings underline the importance of incorporating cultural context into FDI policy formulation and investment strategies, particularly in emerging economies seeking deeper integration into the global economy.