THE IMPACT OF DEBT BURDEN ON THE ECONOMIC GROWTH OF NIGERIA (1970-2021)

Henry I ONWERE; Olalekan E OBADEMI

Henry I ONWERE
Olalekan E OBADEMI University of Lagos

Keywords: external debt, economic growth, exchange rate, inflation rate

Abstract

The study used autoregressive distributed lag (ARDL) to examine the influence of external debt on Nigeria’s economic growth using annual time series data from World Bank Development Indicators from 1970 to 2021. The findings show a significant positive relationship between interest rates and economic growth in the short and long run. In contrast, inflation rate significantly negatively impacts economic growth in the short and long run. External debt, external debt service, and the exchange rate have an insignificant impact on economic growth in the short and long run. The study recommends reducing the cost of governance to promote development, while investment in the Nigerian economy should be encouraged.