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How can Africa, the world s most lagging region, benefit from globalisation and achieve sustained economic growth? Africa needs greater investment by Multinational Enterprises (MNEs) to improve competitiveness and generate more growth through positive spill-over effects. Despite the fact that Africa s returns on investment averaged 29% since 1990, Africa has gained merely 1% of global Foreign Direct Investment (FDI) flows. The challenge for African countries is how to be a more desirable destination for FDI. The study integrates three currents of economic research, namely from the literature on (endogenous) economic growth, convergence and regional integration, the explanations for Africa s poor growth and the growing understanding of the role of MNEs in a global economy. The empirical side of the book is based on an econometric study of the determinants of FDI in Africa aswell as a detailed firm-level survey conducted in 2000.