Regional Integration and Its Impact on Foreign Direct Investment (FDI)

Among possible measures taken by some countries to safeguard against the phenomenon of globalization is leaning on regional integrations. In fact concurrent with globalization efforts the idea of regional integration has gained momentum in all continents. By utilizing their comparative advantages in different areas, the Islamic countries can ward off against the ill impacts of the globalization era and use these advantages to attract more foreign direct investments and hence achieve higher rates of economic growth
In this article an effort is made to evaluate the impact of regional integration and knowledge based economy on boosting bilateral FDI among the member countries of OIC by using The adjusted gravity model for the period 2005-2013. The results indicate that regional integration among the above countries has increased the level of bilateral FDI‘s among them. This fact calls for further cooperation among the OIC member countries.