TITLE:
A Developing Country’s Absorptive Capacity: The Link between FDI and Economic Growth in Nigeria
AUTHORS:
Uyiosa Omoregie
KEYWORDS:
Foreign Direct Investment, Absorptive Capacity, Economic Growth, Gross Domestic Product, Nigeria
JOURNAL NAME:
Open Access Library Journal,
Vol.2 No.11,
November
13,
2015
ABSTRACT: Developing countries’ surest route to sustained poverty reduction is
economic growth. Policymakers encourage foreign direct investment (FDI) for the
enhancement of productivity in-country and the promotion of economic
development, through the “multiplier” effect. It is generally agreed among
researchers that local conditions (absorptive capacities) are important factors
contributing to the effect of FDI on economic growth. FDI has contributed to
output growth in Nigeria, especially in the petroleum sector, where even more
FDI should now be encouraged through investor incentives. However, the efficacy
of FDI in generating the desired growth may be limited by the level of
infrastructural and human capital development in Nigeria.