Abstract
The research examined the effect of debt on Nigeria’s economic growth over the period from 1981 to 2022.
Time - series data obtained from the Central Bank of Nigeria (CBN) Statistical Bulletin, Annual Report, and
Statement of Accounts were analyzed. The research employed Autoregressive Distributed Lag (ARDL)
approach, Variables including domestic debt stock, external debt stock, total debt servicing, total revenue, and
Gross Domestic Product (GDP) were used. The findings revealed significant long-term relationships between
debt, debt servicing, and revenue with GDP. In terms of short-term dynamics, domestic debt was found to have
a strong positive impact on GDP growth, with total revenue playing a crucial role. On the other hand, external
debt and debt servicing obligations do not show a statistically significant impact on GDP growth. Granger
causality tests indicate a unidirectional effect from debt to GDP growth. These results offer valuable insights for
policy makers aiming to manage public debt and revenue generation efficiently to promote sustainable
economic growth in Nigeria. The research recommended strengthening efforts to manage domestic debt
effectively to foster economic growth, while mitigating the risks of excessive borrowing
2024-12-01
Vol. 1 Issue No. 1 December 2024
Articles
Vol. 1 Issue No. 1 December 2024
/ ArticleDEBT AS A CATALYST FOR NIGERIA’S ECONOMIC GROWTH: A CRITICAL ANALYSIS OF THE DEBT-GROWTH NEXUS
Ibrahim S. Muhammad, PhD
Department of Economics, Shehu Shagari University of Education, Sokoto State - Nigeria
ibrsmuhammad@yahoo.com
Muhammad Sabir Ibrahim
Department of Economics, Usmanu Danfodiyo University, Sokoto - Nigeria
sabirsanyinna@gmail.com