Measuring Globalisation through Foreign Direct Investment Inflows or Outflows: A Basis for Economic Development in West Africa

Abstract

The study examined empirically the challenges encountered by foreign investors for direct foreign investment in Nigeria, ascertain the nature of the relationship between the foreign investors and the host nation, ascertain the extent of the relationship between foreign direct investment and economic growth. The study was carried out primarily through descriptive survey design and interview of employees from central bank of Nigeria, National bureau of statistics and Cadbury Plc. Secondary data were obtained through books, journals, and internet. Pearson product – moment correlation coefficient and Chi square were used to test the hypotheses using SPSS.

Findings indicated that Foreign exchange risk, political risk and increased agency cost are challenges encountered by foreign investors for foreign direct investments in Nigeria, there is a positive relationship between the foreign investors and the host nation, and there is a significant relationship between foreign direct investment and economic growth.Foreign direct investment (FDI) plays an extra ordinary and growing role in international business. It can provide a firm with new markets and marketing channels, cheaper production facilities, access to new technology, products, skills, and financing.

Keywords: Globalisation, Foreign Direct Investment, Portfolio Investment, and Economic Growth