Abstract
The paper investigates the relevance of foreign direct investment (FDI) as a factor inhibiting economic growth in Nigeria. This paper inspects the sectorial influence of FDI in manufacturing, mining, oil and the telecommunications sectors on economic growth in Nigeria based on theoretical framework founded on the standard growth accounting theory, detailed analysis of the sectorial FDI over the period 1981 and 2017 was carried out. Various econometric methods are employed, such as the ADF test, Dickey and Fuller test (1979), PP test (Phillips and Perron, 1988) are used for the unit root test, and the Shahbaz and Rahman (2010) method is used for the long-run relationship between the foreign direct investment and economic growth. The paper also adapted the framework provided by M.B. Obwona (2004). The paper formalizes a mechanism of recommendations to allow for the influence of foreign direct investment in the transmission of socio-economic growth generated in Nigeria. In conclusion, government should provide an enabling environment that will encourage foreign investors to invest in Nigeria economy by addressing the security challenges in the country, understanding that investment friendly environment will improved regulatory framework as well as encourage domestic investment.
Highlights
Socio-economic development is a multidirectional procedure which is germane for the sustainability of an economy
According to (Alfaro et al, 2004), it is recognized that foreign direct investment (FDI) brings growth benefits to developing countries depending on the absorptive dimension of these economies to grasp gains from technology transfer and spillover effects
The paper aims to examine the relevance of FDI to economic growth in the short and long run in lower-middle-income in Nigeria
Summary
Socio-economic development is a multidirectional procedure which is germane for the sustainability of an economy. According to (Alfaro et al, 2004), it is recognized that foreign direct investment (FDI) brings growth benefits to developing countries depending on the absorptive dimension of these economies to grasp gains from technology transfer and spillover effects. It is a long-run process whereby the real national income of an economy accelerates over a long period of time. In the face of domestic resources deficit in financing socio-economic developmental projects, most emerging countries are relying on external financial sources and assistance from the developed countries It was only in the post war period that a well-structured foreign capital flow began to experience wide recognition and attention, when
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