Market Entry Strategies and Performance of Foreign Direct Investment in Enugu State, Nigeria

Foreign direct investment (FDI) continues to play a catalytic role in the economic development of sub-national economies in Nigeria, yet the performance outcomes of FDI ventures vary substantially depending on the market entry strategies adopted and the institutional environment encountered. This study examines the relationship between market entry strategies and the performance of FDI enterprises in Enugu State. The study is anchored on the Eclectic Paradigm (OLI Framework) developed by John Dunning, which explains FDI decisions through ownership, location, and internalisation advantages. A cross-sectional survey research design was adopted. The population comprised 97 FDI enterprises operating across manufacturing, services, and agribusiness sectors in Enugu State. A sample of 80 firms was selected using purposive and systematic sampling, targeting general managers and investment coordinators. Data were collected via structured questionnaires and supplemented by secondary data from the Enugu State Investment Promotion Authority. Regression analysis and ANOVA were applied for data analysis. Findings reveal that joint venture entry modes, which leverage local partnership networks, produce significantly higher profitability and market penetration outcomes compared to wholly-owned subsidiary models in the Enugu context. The results further identify regulatory inconsistency, infrastructure deficits, and security concerns as the most significant location-specific deterrents to FDI performance. It is concluded that market entry strategy selection must be calibrated to the specific institutional and market conditions prevailing in Enugu State. The study recommends that the Enugu State Investment Promotion Authority develop targeted investor support packages that reduce entry barriers and provide after-investment facilitation services.

Keywords: Market entry strategy, foreign direct investment, Eclectic Paradigm, Enugu State, investment performance