FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN NIGERIA
A research work is an assignment of FDI and economic growth in Nigeria. the need to embark on the study was motivated by decline in economic growth vis-à-vis general economic under-development. A research objectives amongst others is the determination of a relationship between FDI and GDP, Exchange Rate and Inflation Rate. In line with achieving this objective a descriptive design was adopted for use, utilizing CBN statistical bulletin from 2000 to 2012. Data were analyzed using percentage increased and frequency distribution table while hypothesis was tested using ordinary least square regression analysis. The researcher found out that FDI impact positively on GDP, Exchange Rate and Inflation. On the basis of the findings the researcher recommended that the role of Nigerian Investment Promotion Council (NIPC) should be strengthen in other to promote FDI into the country.
1.1 BACKGROUND OF STUDY
1.2 STATEMENT OF THE PROBLEM
The Nigerian economy is believed to be associated with high risk market and dividing growth because of factors such as bad governance, unstable macroeconomic policies among others. Despite the plethora of incentive to stimulate growth which include the repeal of laws that are inimical to foreign investment growth and the re-branding campaign, among others, the performance of economy in terms of quantum and per capital income is still very unimpressive and indeed disappointing in Nigeria.It is against this back drop that this study, seeks to investigate foreign direct investment and economic growth with the hope of proffering suggestions that could enhance in inflows of foreign investors capable of inducing growth in the economy.
1.3 OBJECTIVES OF THE STUDY
The objective of this study is as follows;
- To examine the relationship between direct foreign investment and economic development in Nigeria.
- To ascertain the level of foreign direct investment in Nigeria.
- To examine the role of foreign direct investment in the growth of Nigeria economy.
- To ascertain the adequacy of the level of fiscal incentives given to foreign investors by the Nigeria government.
1.4 RESEARCH QUESTIONS
In carrying out this research work, there are certain questions that need to be asked which will enable the researcher to retrieve data that will be useful to the work,
- Is there positive relationship between FDI and economic growth?
- Is there positive relationship between FID and exchange rate?
- Is there positive relationship between FDI and trade openness?
- Is the level of FDI in Nigeria adequate?
- What is the exact impact of FDI in the economic growth of Nigeria?
1.5 RESEARCH HYPOTHESIS
In order to find answers to the question raised in the research question, the following hypothesis are necessary.
Ho1: There is no relationship between direct foreign investment and economic development in Nigeria.
Ho1: There is a relationship between direct foreign investment and economic development in Nigeria.
1.6 SIGNIFICANCE OF THE STUDY
Given the unprepossessing growth rate of the Nigeria economy, especially as she is interested in becoming one of the twenty largest economic in the world by year 2020, the study will focus on;
1. Discovery the factor that will extend the frontiers of foreign investment flows in the economy.This research will serve as a good guide for monetary authorities and authorized players in the external sector as it will portray as a glance, the state of foreign investment in Nigeria. there is no doubt that future researcher will also find it useful for further research.
2. It will also serve as a guide to economic policy makers and planners in future decisions concerning foreign direct investment.
3. It is equally hoped that the findings and recommendation of this study will be of immense benefit not only to the government, but also to others researchers and students for future research undertakings.
1.7 SCOPE OF THE STUDY