EFFECTOFSECTORALFOREIGNDIRECTINVESTMENTON ECONOMICGROWTHINNIGERIA

ABSTRACT

ThepurposeofthisstudyistoexaminetheeffectofsectoralForeignDirectInvestment

oneconomicgrowthinNigeriamakinguseoftimeseriesdatafortheperiod1981-2018.

AnAuto-regressiveDistributedLag(ARDL)technique(withemphasisonshortrun

estimates)isusedtoexaminetherelationshipforseriesthatareI(0)andI(1).Thestudy

considersfive FDIsectors which includes:Telecommunication infrastructures,oil,

Agriculture,Manufacturing,Services andotherinfrastructuressectorsasitsvariables

representingsectoralforeigndirectinvestmentwhileGrossDomesticProduct(GDP)is

employedasaproxyforeconomicgrowth.

ThestudyobservesnolongrunrelationshipbetweensectoralFDIandeconomicgrowth.

Hence,shortrunestimationwithoutaccountingforadjustmentmechanism isestimated.

TheresultsshowsthatTelecommunicationinfrastructuresFDI,ServicesFDIandother

infrastructures FDI are significant to economic growth. However, only

TelecommunicationinfrastructuresFDIspurseconomicgrowthwhileServicesFDIand

otherinfrastructuresFDIdrageconomicgrowthinNigeria.

Conclusively, this study recommends that government should ensure stable

macroeconomicpoliciesasastabilizationtooltoprompttheattractionofmoreFDIinto

Nigeriaanddependencyonforeigndirectinvestmentshouldremainlimited.