Foreign direct investment (FDI) inflow activities are seen as a threat to the survival of resource-constrained SMEs in Ghana. Hence, this preconception stifles collaborations between foreign and local businesses. Therefore, to justify the need for such collaborations, we estimate the relationship between FDI inflow activities and SMEs’ strategic decision making as well as the mediating role of interfirm value co-creation using the structural equation model. Using data survey responses of 856 Ghanaian SMEs, we find positive significant relationships between FDI inflow activities, environmental sustainability decisions, economic sustainability decisions, and social sustainability decisions. Further, interfirm value co-creation mediates the positive relationship between FDI inflow activities and economic sustainability decisions. So, SMEs should embrace FDI inflow activities in the country and create knowledge from the technology and human expertise of these businesses. Again, policymakers should devise forward-thinking strategies to stimulate an information-sharing ecosystem promoting collaboration between domestic and foreign-owned businesses in Ghana.
Cite this paper
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