An assessment of foreign direct investment and sustainable development nexus : the Nigerian and Ghanaian perspectives

This study explored contribution of foreign direct investment (FDI) inflows to the sustainable development of the Nigerian and Ghanaian economies. The investigation was prompted by the apparent evidence of rising FDI inflows in the last two decades, which has failed to improve both nations’ sustainable development drive significantly. The study employed the ordinary least square (OLS) econometric technique to test the effect of FDI inflows on sustainable development indicators using annual times series data from 2000 to 2018 obtained from both countries’ World Development Indicators (WDI) for the period covering the Millennium Development Goals (MDG) era and the earlier stages of the Sustainable Development Goals (SDG) of the United Nations (UN). The findings revealed that Ghana performed better than Nigeria on social sustainability, measured in terms of education and healthcare indicators. However, on environmental and economic sustainability, Nigeria fared better. A percentage increase in FDI inflow to both countries enhances economic growth and economic sustainability by 0.30 percent. However, study indicated that the positive impact is statistically insignificant. This reveals that the difference in economic growth and economic sustainability in both countries is not accounted for by FDI.