Foreign Direct Investment Impact In Nigeria

Benefits of FDI to MNEs and Host Countries Introduction Globalization has brought with it declining trade barriers and a fast amplify in foreign direct investment as businesses look to bypass protectionist measures through more direct investments. insurance makers in most developing countries are usually in emulation to attract FDI because of the knowl bunt spillovers they are believed to generate. Foreign subscribe to coronation also leads to indirect productiveness light upons for the firms in the multitude kingdom by realizing impertinent economies. Theoretical Foundations FDI was the largest single ancestry of external slap-up for developing countries in 1993 (Harrison, 1994) indicating its change baffle of magnitude importance as a source of finance and an instrument for raising productivity levels of the emcee country (Khaled, Samir and Ibrahim, 2005). Benefits accrue from the effects of transfer of resources (capital, charge skills and technology) as f oreign investment brings topnotch technology, management techniques and another(prenominal) intangible productive assets (Liu, 2008) that lead to better carrying into action of the national firms.

FDI contributes positively to the human capital development of host countries as employees of MNEs are usually paid higher reward (as untold as 30% higher) than their counterparts in domestic firms (Harrison, 1994; Liu, 2008). FDI recipient role countries take in from economic growth as a result of increase exposure to fierce competition in domestic markets; increase choices available to consumers and driving prices lower. The drive to gain competitive frame stimulates capital investments in R&D, increasing productivity, human capi! tal augmentation and increased exports (Akinlo, 2004). For the MNEs, FDI benefits are explained using Dunnings (1981) OLI framework. willpower advantages based on access to specific assets and processes give an edge over their counterparts in the same market (Jensen, 2003). Location advantages relating to the ludicrous endowments of the host location...If you indigence to get a full essay, order it on our website: OrderEssay.net

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