The Impact Of Foreign Direct Investment On Nigeria Economic Growth (1980 – 2010)
Abstract
The study examined the impact of foreign direct investment( FDI) in Nigeria over the period 1980 to 2010. The study employed multiple retrogressions in analysis, using the ordinary least square( OLS) retrogression fashion. The result at this revealed that FDI impacted appreciatively on the growth of the Nigeria frugality over the period under study. Grounded on this, the study recommended the provision of acceptable structure and policy frame that will be conducive for doing business in Nigeria, so as to attract the flux of FDI necessary to stimulate growth.
Chapter One
Background Of Study
Since the attachment of independent in 1960 colorful programs of the Nigeria government have been geared basically towards promoting the growth and development of the Nigeria frugality by impacting the trends of gross fixed domestic investment or laterally through programs aimed at stimulating the inflow of foreign finance in any growing frugality. This is so given that in the literature there are divergent views on the nature of goods of foreign direct investment has been argued to be the most growth stimulation source of foreign finance in any growing frugality. This is so given that in the literature there are divergent views on the nature of goods of foreign direct investment on host economics. Those that are of the view that foreign direct investment produce positive goods on host economics argue that some of the benefits are in the form of externalities and the relinquishment of foreign technology, employers training and the preface of new process by the foreign enterprises according to Ayadi,( 2002) foreign direct investment especially when it flows to a high threat area of new enterprises where domestic resource is limited.
The first public development plan was launched for artificial trade off and developments still as foreign artificial investors were. Rather alive of the incipient independent administration sweats had to be made not only to amalgamation their fears of nationalization but also attract fresh foreign investment through common adventure with individualities or the state. still Nigeria frugality has been one of the important destination points of foreign direct investment insub-Saharan Africa. The quantum of foreign direct investment flux into Nigeria according to ayadi( 2002) has reached US$2.23 billon in 2003 and it rose to US$5.31 billons in 2004(9.13 increase) the figure rose again to US$9.92 billion( 87increasing) in 2005. The figure still declined slightly to US$9.44 billion in 2006.
Nigeria is argued to be spiritedly blessed with enormous mineral and mortal resource but believed to be largely parlous request for investment. Also decade of bad governance have nearly crippled. The public frugality with corruption and misappropriation is of fund getting the norm rather than anticipation. What’s the way out of this profitable state? numerous experts accepted that foreign direct investment. Is a empirical cracker to protest start the frugality. According to Odozi( 1995) foreign investment appears to be the most. pivotal element of capital inrushes and Nigeria should seek to attract in light of her current profitable circumstance. Some scholars are of the view that Nigeria. Is in need of foreign direct investment as a empirical cracker of the Nigeria frugality while others are of the view that foreign direct investment is a form of neo- colonialism to what extent. Has foreign direct investment helped. The profitable growth in Nigeria.
Statement Of Problem
One of the major profitable problem in lower developed countries( TV) is low capital conformation to finance the necessary investment for profitable growth.
Capital was one regarded by utmost economists as the top handicap to profitable development and this is lot amenities were paid to capital conformation. The part of capital in profitable growth is still regarded as veritably pivotal both the proposition of ‘ big drive ’ and the conception of ‘ vicious cycle ’ all a test to the pivotal part of capital in the growth process. The proposition of ‘ big drive ’ simply state that the stagnant and uninhabited husbandry need huge and unforeseen injection of large capital from foreign direct investment.
still in the literature FDI is set up to be related to import growth while mortal capacity structure is set up to be related to FDI floe.
utmost studies on FDI and growth are cross country studies. still FDI and growth debates are country specific. Among Nigeria studies like those by otepola( 2002) oyeyide( 2005), Akinlo( 2004) examined the significance of FDI on growth for several period and the channel through which it may be serving the frugality.
In the literature there live a direct positive link between import growth and the growth of an frugality. This growth in import can further be traced down to the position of investment which in utmost cases can be domestic or foreign investment.
This is so given that foreign capital remains the sure stylish option of filling the saving investment gap where it exists. Given this fact assessment will be grounded on the being link among investment, import, exchange rate and profitable growth.
These problems thus raise the following exploration question.
1. What’s the impact of foreign direct investment to the growth of Nigeria frugality?
Ideal Of The Study
The objects of the study are as follow
1. To find out whether or not FDI has a significant impact on the growth of the Nigeria frugality.
2. To determine the nature and magnitude of the impact of FDI on profitable growth in Nigeria.
Statement Of The Thesis
H01 FDI has no significant impact on the growth of the Nigeria frugality
H02 The nature and magnitude of FDI on economics growth in Nigeria can not be determined.
Compass/ The Limitation Of The Study
The focus of the study is to corroborate if there has been any donation made toward the profitable growth and development of the Nigeria economics via gross domestic product( GDP) through foreign direct investment for the period.( 1990- 2010)
This study will still be limited to probe the impact of foreign direct investment on the growth of the Nigeria frugality.
Significance Of The Study
Chancing from the study will be of immense benefits in a number of ways and to different groups of persons.
1. For policy timber, the anticipated result outgrowth shall serve as a riseful companion for unborn programs as it relates to stimulating growth within the frugality.
2. For farther studies, it’ll serve as a force of knowledge for similar academic exercises.
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