The Place of Foreign Direct Investment (Fdi) in Development of Low Developing Countries (Ldc's): with Experience from Nigeria

The Place of Foreign Direct Investment (FDI) in development of Low Developing Countries (LDC’s): with experience from Nigeria

Egbo Obiamaka PhD
Department of Banking and Finance, University of Nigeria,
Enugu Campus, Nigeria
E-mail: obiamaka.egbo@unn.edu.ng

ABSTRACT

The inflow of foreign direct investment (FDI) into developing countries varies greatly across countries and over time. One of the most salient features of today’s globalisation drive is conscious encouragement of cross-border investments, especially by trans-national corporations and firms (TNCs). Many countries and continents (especially developing) now see attracting FDI as an important element in their strategy for economic development. This is most probably because FDI is seen as an amalgamation of capital, technology, marketing and management.   Many African countries have been working very hard to ensure the smooth flow of Foreign Direct Investments (FDIs) in their countries, as it is believed that FDI is a major key for development. Following this fact, developing countries have been looking for better policies to attract FDIs in order to ensure better lives for their people. It is suggested that in order to attract greater inflows of foreign direct investment in the future, African nations need to accelerate progress towards more open economies, greater economic freedom, more effort in fighting corruption and a legal environment that guarantees property rights.

1.0 INTRODUCTION.

Foreign Direct Investment (FDI) is made to acquire a lasting interest in a foreign enterprise with the purpose of having an effective voice in its management (Bjorvatn, 2000). It is a business investment in another country, which often takes the form of setting up local production facilities or the purchase of an existing business (Rutherford, 1992:178). Thus, foreign direct investment involves the transfer of tangible or intangible assets from one country into another for the purpose of use in that... [continues]

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