Journal of Harmonized Research in Management

FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH: HOW IMPORTANT IS GOVERNMENTATTITUDE AND FINANCIAL DEVELOPMENT IN NIGERIA?

Abstract

Author(s): Ismail Adigun Olayemi, Adenekan Bashir Ayomide

Financial sector development and the quality of governance of an economy will determine the amount and productivity of incoming finances. This study investigated the effect of foreign direct investm ent (FDI) on economic growth given the government quality and financial development in Nigeria with a data span of 1981 to 2013. The findings suggested an insignificant effect of FDI on growth. Governance quality and the financial sector do not help the situation as seen in the interactions. Repositioning the governance structure and quality, and broader development of the financial sector, including monitoring and ensuring adequate use of credits by the financial sector will ensure positive and significant relationship between FDI and growth.