Sectoral Inflow of Foreign Direct Investment and Economic Growth in Nigeria

Abstract

The paper examined the sectorial inflow of Foreign Direct investment and its impact on Economic Growth in Nigeria. The main objectives of the study are to find out the impact of the sectorial inflow of FDI on Economic Growth and find out the impact of FDI on Poverty Reduction in Nigeria. The study made use of secondary data and discovered that there is a positive relationship between GDP and FDI, meaning that both FDI and GDP changes in the same direction. Also, the study discovered that in the long run, investment in the business and agric sectors can only make meaningful impact on the economy because it takes time to get back investment in these sectors. The conclusion of the study is that the major reason for the low impact of FDI on Economic Growth in the country is that FDI inflow has been towards certain sectors (oil and gas, communication, construction, e.t.c) at the expense of those sectors (agriculture, tourism, manufacturing, e.t.c) that has the greatest potential for poverty reduction and Economic Growth, so while I say FDI is good, it should be encouraged towards those neglected sectors.

Keywords: FDI, Economic Growth and Sectoral Inflow