Existing empirical evidence suggests that the link between financial openness and
economic growth is weak at best. While there is some evidence that financial
liberalisation positively affects growth, this relationship is not robust. There is also
some evidence that the positive impact of foreign investment on growth is
conditional upon the existence of relatively developed domestic institutions and
sound macroeconomic policy. This result is also not very robust and is sensitive to
the measures employed to capture institutional development and the policy
environment.