Foreign Borrowing and Economic Growth in an Emerging Economy: The Nigerian Case
9 Pages Posted: 14 Aug 2009
Date Written: August 12, 2009
Abstract
The focus of this paper is on foreign borrowing and economic growth of an emerging economy with Nigeria as a case of reference. It examines the linkages between foreign borrowing and selected macroeconomic indices such as Gross Domestic Product, (GDP), poverty, private investment, government investment, export/income ratio, vis-à-vis external debt to income ratio. The ordinary least square technique (OLS) was adopted through the use of time series data on the variables. Data were sourced from central bank of Nigeria statistical bulletin, International Monetary Fund (IMF), Human Development Reports International financial statistics year book and World Bank global finance. The study advocates that government investment in education, health, export and international trade should be adequately improved and encouraged by government so as to step up the standard of giving devoid of foreign borrowing. A negation of this, the paper opines, makes foreign debt a source of economic woes to the economies.
Keywords: borrowing, economic growth, savings, investment, poverty, export
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