ILO Brief
FDI and global value chains in Tunisia, Egypt and Morocco
Foreign direct investment supports employment in Egypt, Morocco and Tunisia, but its impact depends more on where foreign firms operate and their role in global value chains than on the overall volume of investment.
Key points
- FDI’s employment impact depends strongly on where and how foreign firms operate: Across Egypt, Morocco and Tunisia, foreign affiliates make a meaningful but limited contribution to output and employment, with their employment effects driven more by sectoral specialization and position in value chains than by the overall volume of FDI.
- The three countries show distinct FDI patterns and thus integration strategies into international production networks: Tunisia has the highest foreign-affiliate penetration (20.7 per cent of gross output), Morocco shows the strongest export-oriented expansion, particularly in automotive and chemicals, while Egypt has the largest absolute foreign-affiliate footprint, concentrated mainly in extractive industries.