Project Abstract

Abstract
Foreign Direct Investment (FDI) plays a crucial role in the economic development of countries around the world, including Nigeria. This study aims to assess the impact of FDI on the economic growth of Nigeria from 1990 to 2011. Nigeria, as one of the largest economies in Africa, has been actively seeking foreign investment to drive its economic growth and development. The research utilizes a combination of quantitative analysis and statistical methods to analyze the relationship between FDI and economic growth in Nigeria over the specified period. Various economic indicators such as GDP growth rate, FDI inflows, trade openness, and other relevant variables are used to assess the impact of FDI on the Nigerian economy. The findings of the study indicate a positive relationship between FDI inflows and economic growth in Nigeria during the period under review. The influx of foreign investment has contributed significantly to the growth of various sectors in the Nigerian economy, including manufacturing, services, and infrastructure development. FDI has also led to technology transfer, job creation, and increased productivity in the country. However, the study also highlights some challenges and limitations associated with FDI in Nigeria. These include issues related to governance, infrastructure deficiencies, bureaucratic hurdles, and macroeconomic instability. Addressing these challenges is crucial to maximizing the benefits of FDI and ensuring sustainable economic growth in Nigeria. Overall, the research underscores the importance of FDI as a catalyst for economic growth in Nigeria. By attracting foreign investment, Nigeria has been able to tap into external resources, expertise, and technologies that have positively impacted its economic development. The study recommends that Nigeria continues to create a conducive environment for foreign investors, address regulatory bottlenecks, and invest in critical infrastructure to further enhance the positive impact of FDI on its economy. In conclusion, the findings of this study contribute to the existing literature on the relationship between FDI and economic growth in developing countries like Nigeria. The insights gained from this research can inform policymakers, investors, and other stakeholders on the significance of FDI in driving economic growth and development in Nigeria.

Project Overview

This study assess the impact of Foreign Direct Investment in Nigerian economic growth over the period of 1990-2011. Data from Central Bank of Nigeria (CBN) Statistical Bulletin was used. The Ordinary Least Square (OLS) technique was specified and used to examine the relationship between the variables which includes the Gross Domestic Product as the dependent variable, export, Exchange rate, foreign direct investment and trade openness as the independent variables.

The explanatory power of the model was given by the R2 of 85.5% and was subjected to t-test and f-test to test the significance of the independent variables.

CHAPTER ONE

1.0        INTRODUCTION

1.1        BACKGROUND OF THE STUDY

Investors’ decisions and actions globally are influenced significantly by the dictates of self-interest which suggests that capital, not only be channeled to high-yielding economic sectors but also to those that are ostensibly quick yielding economies. On balance therefore investors would spun profitable opportunities characterized by extreme competitions, market glut, unfavorable regulation, long gestation periods and opt instead for investments that yield high returns within the shortest time possible. Base on this view, investors generally migrate from

one economy to another in search of better investment climate and higher returns.

This form of capital movement results in the creation of a typical investment called Foreign Direct Investment. In the opinion of Jomo (1988) Foreign Direct Investment can be explained to represent the flow of tangibles from a country abroad of capital, equipment and other production and processing facilities.