Foreign Direct Investment in Nigeria: Volume, Trends and its Effect on the Manufacturing Output (1981-2020)
Keywords:
Adams, S. (2009). Foreign direct investment, Domestic investment and economic Growth in the Sub-Saharan Africa. Journal of policy modelling, 31(6), 939-949. Afolabi, A., Laseinde,O.T., Oluwafemi, I.J., Atolagbe, O.D and Oluwafemi, J.F (2019). Correlation between Manufacturing Sector and Foreign Direct Investment. International Conference on Engineering for Sustainable World, 1-14. Andrew, E., Chukwudi, U.S & Uchenna, O.P. (2015). An analysis of the trends of Foreign direct investment inflows in the Nigerian construction sector. American international journal of Contemporary Research, 5(1), 53-69. Anyanwu, J.C. (1993). Monetary Economics: Theory, Policy and Instruction. Onitsha. Hybrid Publishers ltd. Aremu, J.A. (2005). Foreign direct investment and Performance. Paper delivered at a workshop on foreign investment policy and practice organized by the Nigerian Institute of Advance Legal Studies, Lagos. Barro, R.J. (1991). Economic Growth in a cross section of countries. Quarterly Journal of Economics, 106(2), 407-443. Central Bank of Nigeria (2003). Annual Report and Statement of Account for the Year ended 31st December. Abuja. Central Bank of Nigeria. Central Bank of Nigeria Statistical bulletin (2020). Various issues. Central Bank of Nigeria .Abuja, Nigeria. Chandran, V.G.R. (2008). Foreign direct investment and Manufacturing Growth: The Malaysian Experience. International Business Research, 1(3), 83-90. Chenery, H.B. & Strout, A. (1966). Foreign Assistance and Economic Development. American Economic Review, 55, 679-733. Ekienabor, E., Aguwamba, A & Nuruddeen, L (2016). Foreign Direct Investment and its Effect on the Mnaufacturing sector in Nigeria. International Journal of Scientific and Research Publications, 6(5), 671-679. Eze,A.A; Nnaji, M and Nkalu, N.C (2019). Impact of Foreign Direct Investment on Manufacturing Sector Output Growth in Nigeria. International Journal of Applied Economics, Finance and Accounting, 5(2), 55-64. DOI: 10.33094/8.2017.2019.52.55.64 Garuba, I.G. (1998). Comparative system for supporting Agricultural credit and rural finance delivery in Nigeria and India. Central Bank of Nigeria, 12(2). Grossman, G.M & Helpman, E. (2003). Outsourcing versus FDI in industry equilibrium. Journal of the European Economic Association, 1, 317-327. Idoko, C. U., & Taiga, U. U. (2018). Effect of Foreign Direct Investment (FDI) On Manufacturing Output In Nigeria (1981 – 2016). Advances in Social Sciences Research Journal, 5(5) 181-197 Mounde, W. L. (2017). Causal relationship between foreign direct investment and manufacturing output in Nigeria. International Journal of Advanced Studies in Business Strategies and Management, 5(2), 233-267. Okoli, T. T. & Agu, O. C. (2015). Foreign direct investment flow and manufacturing sector performance in Nigeria. International Journal of Economics, Commerce and Management, 3 (7) 413-428 Onu, A.J.C. (2012). Impact of foreign direct investment on Economic Growth in Nigeria. Interdisciplinary journal of contemporary Research in Business, 4(5), 64-75. Orji, A., Anthony-Orji, I.O., Nchege, E.J. & Okafor. (2015). Manufacturing output and foreign direct investment in Nigeria: A new evidence. International journal of Academic Research in Economics and Management Sciences, 4(3), 16-28. Orya, R. U. (2016). Attracting FDI to Nigeria’s non-oil sectors. Retrieved from http://www.financialnigeria.com/attracting-fdi-to- nigeria-s-non-oil-sectors-blog-138.html#sthash.VvH5Z5ec.dpuf on 28 November 2016. Oyin, O. (2014). The effect of foreign direct investment: case study of Nigeria. Unpublished Master thesis. Department of international business, university of OULU. Romer, P. (1990). Endogenous technological change. Journal of Political Economy, 98(5), 71- 103 Umah, K.E. (2007). The impact of foreign private investment on Economic Development of Nigeria. Nigerian journal of Economics and Financial Research, 1(3). UNCTAD, (2009). World investment Directory. Geneva, UNCTAD.Abstract
In recent times, owing to the scantiness of earnings from the oil exports, the import-reliant industrial structure became unsustainable as it could not essentially cater for the humongous import bills. Hence, FDI has become more relevant to the developed nation and the vast majority of developing nation (Nigeria) through improvement in the attraction of immense inflows into these countries. Hence, the main thrust of this work is to ascertain the volume, trend, and impact of FDI on the Nigerian manufacturing output from 1981 to 2020. This was done by specifying and estimating a regression model using the Autoregressive Distributive Lag model (ARDL). The estimated regression model was found to have desirable statistical attributes thereby allowing valid statistical inferences to be made from it. The estimated regression results surprisingly suggest that FDI hurt manufacturing output in the country as it leads to a decline in the sector. Expectedly, exchange rate, has a positive effect on the manufacturing output and this is statistically significant at 5%. The conclusion inferred from this study is that FDI does not have a far-reaching effect on the manufacturing output in Nigeria. Consequently, more efforts should be geared towards blocking the loopholes and ensure that the inflow into the sectors are utilized for the purpose as to make its effect felt in the sector. Also, the exchange rate should be allowed to freely float to ensure the high competitiveness of the Nigerian manufacturing exports amongst others.
References
Adams, S. (2009). Foreign direct investment, Domestic investment and economic
Growth in the Sub-Saharan Africa. Journal of policy modelling, 31(6), 939-949.
Afolabi, A., Laseinde,O.T., Oluwafemi, I.J., Atolagbe, O.D and Oluwafemi, J.F (2019). Correlation between Manufacturing Sector and Foreign Direct Investment. International Conference on Engineering for Sustainable World, 1-14.
Andrew, E., Chukwudi, U.S & Uchenna, O.P. (2015). An analysis of the trends of
Foreign direct investment inflows in the Nigerian construction sector. American
international journal of Contemporary Research, 5(1), 53-69.
Anyanwu, J.C. (1993). Monetary Economics: Theory, Policy and Instruction.
Onitsha. Hybrid Publishers ltd.
Aremu, J.A. (2005). Foreign direct investment and Performance. Paper delivered at a
workshop on foreign investment policy and practice organized by the Nigerian
Institute of Advance Legal Studies, Lagos.
Barro, R.J. (1991). Economic Growth in a cross section of countries. Quarterly Journal of
Economics, 106(2), 407-443.
Central Bank of Nigeria (2003). Annual Report and Statement of Account for the Year
ended 31st December. Abuja. Central Bank of Nigeria.
Central Bank of Nigeria Statistical bulletin (2020). Various issues. Central Bank of Nigeria
.Abuja, Nigeria.
Chandran, V.G.R. (2008). Foreign direct investment and Manufacturing Growth: The
Malaysian Experience. International Business Research, 1(3), 83-90.
Chenery, H.B. & Strout, A. (1966). Foreign Assistance and Economic Development.
American Economic Review, 55, 679-733.
Ekienabor, E., Aguwamba, A & Nuruddeen, L (2016). Foreign Direct Investment and its Effect on the Mnaufacturing sector in Nigeria. International Journal of Scientific and Research Publications, 6(5), 671-679.
Eze,A.A; Nnaji, M and Nkalu, N.C (2019). Impact of Foreign Direct Investment on Manufacturing Sector Output Growth in Nigeria. International Journal of Applied Economics, Finance and Accounting, 5(2), 55-64. DOI: 10.33094/8.2017.2019.52.55.64
Garuba, I.G. (1998). Comparative system for supporting Agricultural credit and rural
finance delivery in Nigeria and India. Central Bank of Nigeria, 12(2).
Grossman, G.M & Helpman, E. (2003). Outsourcing versus FDI in industry equilibrium.
Journal of the European Economic Association, 1, 317-327.
Idoko, C. U., & Taiga, U. U. (2018). Effect of Foreign Direct Investment (FDI) On Manufacturing Output In Nigeria (1981 – 2016). Advances in Social Sciences Research Journal, 5(5) 181-197
Mounde, W. L. (2017). Causal relationship between foreign direct investment and manufacturing output in Nigeria. International Journal of Advanced Studies in Business Strategies and Management, 5(2), 233-267.
Okoli, T. T. & Agu, O. C. (2015). Foreign direct investment flow and manufacturing sector performance in Nigeria. International Journal of Economics, Commerce and Management, 3 (7) 413-428
Onu, A.J.C. (2012). Impact of foreign direct investment on Economic Growth in Nigeria.
Interdisciplinary journal of contemporary Research in Business, 4(5), 64-75.
Orji, A., Anthony-Orji, I.O., Nchege, E.J. & Okafor. (2015). Manufacturing output and
foreign direct investment in Nigeria: A new evidence. International journal of
Academic Research in Economics and Management Sciences, 4(3), 16-28.
Orya, R. U. (2016). Attracting FDI to Nigeria’s non-oil sectors.
Retrieved from http://www.financialnigeria.com/attracting-fdi-to- nigeria-s-non-oil-sectors-blog-138.html#sthash.VvH5Z5ec.dpuf on 28 November 2016.
Oyin, O. (2014). The effect of foreign direct investment: case study of Nigeria.
Unpublished Master thesis. Department of international business, university of
OULU.
Romer, P. (1990). Endogenous technological change. Journal of Political Economy, 98(5),
- 103
Umah, K.E. (2007). The impact of foreign private investment on Economic Development
of Nigeria. Nigerian journal of Economics and Financial Research, 1(3).
UNCTAD, (2009). World investment Directory. Geneva, UNCTAD.
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