THE IMPACT OF FOREIGN DIRECT INVESTMENT ON HOSPITALITY SECTOR IN FCT, NIGERIA

Abstract

The hotel industry is a vital component of the Nigerian tourism sector, and contributes significantly to the wider economy at both National and regional levels. The concept of foreign direct investment and its contribution to Nigerian economy, especially the hospitality industry in the FCT was reviewed. The study adopted a survey research approach and three research hypotheses were formulated to guide the study. The research targeted all the 55 five star hotels in Abuja and therefore adopted census based technique. A semi structured questionnaire was sent via email to the hotels but only 30 of the hotels responded and were used for the study. Data generated from survey questionnaires were analyzed using descriptive statistics. Pearson- moment correlation and multiple regression analysis were employed to examine the study’s hypotheses. The findings of the study revealed that the variables are significantly correlated at P<0.01 representing a significant degree of relationship between the variables. The regression analysis showed that technological leverage is sufficiently significant at P<0.05, Employment generation is significant at P<0.05 and productivity is significant at P<0.01. The research established that FDI in the hospitality industry is contributing to Nigerian economy in ways such as technology, employment and productivity. However, the paper concluded that, host country should improve on its level of human capital in order to boost her absorptive and production capacity to leverage on the presence of Transnational Companies to foster economic development.