Foreign Ownership and Performance in Sub-Saharan African Manufacturing and Services

This paper tests for differences in performance between foreign-owned and domestically owned firms in a sample of manufacturing and services firms from 19 sub-Saharan African countries. Results indicate that foreign-owned firms perform significantly better than domestically owned ones in sub-Saharan Africa across several performance measures, with the foreign-ownership premia usually being larger for services firms. The results further indicate that firms owned by a transnational corporation perform better than those owned by individual foreign entrepreneurs, although there is little evidence of differences in performance between joint ventures and wholly owned foreign enterprises.