1887

oa Journal of Management & Administration - Dynamic interaction among external debt, foreign direct investment and economic growth in Nigeria

Volume 2019 Number 2
  • ISSN : 1728-9157

 

Abstract

The study examines the dynamic interaction between foreign debt, foreign direct investment (FDI) and economic growth in Nigeria. The aim of the study is to offer empirical proof of the current type of relationship between Nigeria's external debt, foreign direct investment and economic growth. In this study, secondary data from 1980 to 2016 was used. Data on external debt, foreign direct investment and economic growth was obtained from the Statistical Bulletin released by the Central Bank of Nigeria. A vector autoregressive model was performed to determine interaction effects among the three variables. The result showed that only economic growth and FDI has a positive retaliating interaction. Although both the FDI and economic growth responded positively to innovation in external debt, external debt responded negatively to innovation in both economic growth and FDI, respectively. The results further showed that there exists a unidirectional causal relationship between foreign direct investment and economic growth which runs from FDI to economic growth at 5% level of significance, thus demonstrating the positive retaliating interaction of FDI and economic growth. Policies on borrowed fund for productive investment, alternative means of financing its deficit and improving the economic condition of the Nigerian business environment, are recommended.

Loading full text...

Full text loading...

Loading

Article metrics loading...

/content/journal/10520/EJC-19c603a974
2019-12-01
2020-09-30

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error