Geographical Perspective of the Sources of Foreign Direct Investments in Nigeria

Abstract

The paper examined the geography of foreign direct investments into different sectors of the Nigerian economy. Data was obtained from the Central bank of Nigeria on foreign direct investments from 2003-2012. Analysis was undertaken using geographical information system to perform planar graph of investment origin and destination. Sectorial allocation of FDIs in 33 industry sectors is revealed in the study since 2003. Of all 33 sectors, coal, oil and natural gas expectedly leads the chart with about $80843.64 and 16,350 created jobs for the period under review. Communication appears to be the next sector with huge potential FDIs accounting for about 9,441 jobs in the ten years under consideration. The emergence of mobile telephony in 2009 such as MTN, GLO, ECONET, etc. as private corporations brought with it some form of communication and business revolution in Nigeria. The contribution of this sector to the economy of Nigeria has been resounding, indeed only second to the oil sector. Other industry sectors with high FDIs attraction include manufacturing, automotive OEM, building and construction, food and tobacco, hotel and tourism, real estate, transportation among others. It was recommended that government invest more in infrastructure (like power, communication, transportation and energy) and ensure the availability of other needed facilities that can attract and boost the productive capacity of direct foreign investors, so that more investors can come into the country since effective productivity of present direct investors will attract more foreign investors.

Keywords: Foreign direct investments, geographical information system, economy, industry