Analysis of Foreign Direct Investment

The federal Government of Nigeria is strongly promoting the country as a good destination for FDI claiming that Foreign Investment has a major contribution to economic growth and living standards of Nigerians. Ipso-facto this research seeks to answer the questions: what are the economic and socio-political factors determining FDI? To what extent has FDI influenced economic performance? Relying on the facts that no single theory can explain FDI determinants FDI determinants varies from country to country there were no consistent findings on determinants and causality between FDI and economic performance the study adopted secondary method of data collection. Using co-integration to determine determinants Causality between FDI and economic performance was establised with Granger causality test. In Nigeria gross domestic product unemployment interest rate debt natural resources tax infrastructure corruption and political situation were economic and socio-political factors determining FDI and there was weak causality between FDI and economic performance. Policies on privatization Public-Private Partnerships reduced corruption were encouraged for quality FDI attraction.