Enhancing absorption capacity,attracting and managing capital flows: Chapter 6
Author(s)/Corporate Author (s)Ndikumana L.;
United Nations. Economic Commission for Africa;
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This last chapter of the report examines the capacity of African countries to absorb foreign capital and discusses strategies to attract more capital flows and policies to manage them so as to maximize the benefits while minimizing the risks of financial fragility, Dutch disease effects,and the emergence of enclave economies. A country's capacity to absorb foreign capital depends on many factors, including the quantity and quality of the labor force, the availability and quality of the infrastructure, the efficiency of financial inter mediation, and the overall institutional and policy environment.