International trade and economic growth in nigeria global journals. The foreign direct investment fdi inflow into developing countries including african countries is a source of employment and economic growth. This page provides the latest reported value for nigeria gdp plus previous releases, historical high and low, shortterm forecast and longterm prediction, economic calendar. In our economy today we are privileged to make use of the advanced world countries products having risen from improved or advanced technologies of the world. Foreign direct investment in nigeria dartmouth business journal. Aug 27, 2016 impact of international trade on the economic growth of nigeria 19802012. Effect of external borrowing and foreign aid on economic growth in nigeria ugwuegbe, sebastine ugochukwu1. Fdi in nigeria contributes positively to economic growth. Nigeria gdp annual growth rate 19822019 data 20202022. Nigeria cannot afford to toy with the maritime sector due to. The study use an augmented aggregate production function apf growth model, three methods are performed to test the hypothesis that there is no causal relationship between foreign direct investment,exports, imports and economic growth.
Inclusively, the study examined the effects of reserves management on foreign direct investment and some macroeconomic variables such as exchange rate, inflation, gdp, and mpr nigeria. Foreign direct investment and economic growth in nigeria. Trade openess and economic growth in nigeria 1981 2009 an. Foreign trade and economic growth in nigeria 1980 2010. In 1982 and 1983, nigeria had trade arrears and was financed by promissory notes. Nigeria recorded a capital and financial account surplus of 235. Pdf effect of international trade on nigerian economic.
Their result revealed that foreign direct investment had significant impact on economic growth in nigeria. Usman 2011 posits that international trade has not helped in promoting economic growth of nigeria because her economy still experiences. Saibu 2015 adopted the model developed by scully 2003 for cote divoire. Both international trade volume and trade structure towards high technology export result in positively effect on nigeria economy. Based on the findings, the study recommends that policy makers in nigeria should pay more attention to factors that can boost stock market development, foreign direct investment, trade openness, inflation and banking sector development in order to impact economic growth more positively in line with theoretical evidence that market opening. Abstract this study examined the impact of international trade on economic growth in nigeria, with the objective of identifying the major factors influencing economic growth through international trade and make policy. According to him, foreign trade leads to an increase in the owners incomes, relative to excess factors of production and export of the product, and stimulates economic growth. This paper therefore examines the impact of fdi on economic growth in nigeria, using vector autoregression var modelling to capture the structure of interrelationships among relevant variables. External reserves management and its effect on economic. This study examined the effects of foreign exchange rate and foreign trade on economic growth in nigeria. The impact of foreign direct investment on economic growth.
The impact of foreign trade on the nigeria economy public. Contribution of international trade to economic growth in nigeria. Globalization and economic development in nigeria adeleke omolade, akinola morakinyo and chris ifeacho. A multivariate regression approach was employed to estimate augmented growth models. Impact of foreign direct investment on nigeria economic growth. Effect of external borrowing and foreign aid on economic. Iyoha1 this study examines the nexus between foreign trade and economic growth in nigeria using quarterly timeseries data for 1981q1 through 2010q4. Pdf impact of international trade on the economic growth. We employ the pooled mean group estimation technique, which is appropriate for drawing conclusions from dynamic heterogeneous. On the basis of the findings, the study suggests economic policymakers to rejuvenate the primary sector of india so that it can attract and absorb more fdi and ensure sustainable economic growth.
This article is devoted to the role of foreign trade in the economies of china, the united states, russia and germany. This study investigates how trade openness affects economic growth in developing countries, with a focus on subsaharan africa ssa. The impact of globalization on foreign direct investments in nigeria. Free trade, export expansion and economic growth in nigeria.
Specifically the research work will focus on the following objectives. The economic growth of nigeria to large extent depends on her trade with other nations. Low oil revenues and the lack of major tax policy reforms to significantly increase nonoil revenues led to large revenue shortfalls at all levels of governmentin. This study evaluated the impact of international trade on the nigeria economic growth. Fdi is an important vehicle of technology transfer from developed countries to developing countries. Therefore, the government in the two countries should further open up their economies for international trade and put in place sound macroeconomic policies that. There are many studies done on the relationship between fdi and economic growth. Secondary data were obtained from central bank of nigeria statistical bulletin covering. Statistical bulletin, annual reports and statement of accounts. Free trade, export expansion and economic growth in nigeria doi. Although the overall effect of fdi on economic growth may not be significant,the components of fdi do have a positive impact.
Ajide1 this paper investigates the role of frazer economic freedom index on fdi growth relationship over the period spanning 1980 through 2010 using annual time series data. Foreign trade has not help in promoting economic growth because the nigeria economy still experience some element of economic instability and this trade has also turned the country into an import. We use a dynamic growth model with data from 42 ssa countries covering 1980 to 2012. Foreign direct investment and economic growth in india. What appears to be gaining currency in recent years from crosscountry growth differences is. However, a trade surplus does not necessarily indicate economic strength.
Promotion of economic growth is one of the major objectives of international trade, but in recent times, this has not been the case because the nigerian economy is. This study is designed to examine the foreign exchange rate policy and management on the economic growth of nigeria. International trade refers to exchange of goods and services between one country and another bilateral trade or between one country and the rest of the world multilateral trade. Corruption, foreign direct investment and economic growth. Understanding the business environment through key figures of international trade providing info on the degree of openness to the outside. Pdf impact of international trade on the economic growth of nigeria. Globalization is a process of integrating economic decisionmaking such as consumption, investment, and savings across the world. In view of this, the study aims to provide evidence on the effect of international trade on nigerias economic growth. However, in order to take full advantage of what foreign investment has to offer, nigeria must first improve its economic and political climate. Foreign exchange reserves fer accumulation and macro. The role of investment and trade policy reforms is germane towards this course. Average annual growth ra te of the economy aggregate and sectoral and structure of output. Impact of international trade on economic growth in nigeria 1988.
In brazil, there 2section two 3 central bank of nigeria january 2018 monetary, credit, foreign trade and exchange guidelines for fiscal years 20182019. This page provides nigeria gdp growth rate actual values, historical data, forecast, chart, statistics, economic calendar and news. I have deemed it very necessary to embark on a research work or project on the impact of foreign trade on the nigeria economy. In order to fully account for feedbacks, a vector autoregressive model is utilized. The main type of data used in this study is secondary. The recession was driven by a large contraction in the oil sector. Trade openess and economic growth in nigeria 1981 2009. The study set out to test for both a long run and causal relationship between external debt and economic growth in nigeria. For instance, rodrik 1999, huymen and hilderink2005 were of the opinin that foreign direct investment and trade openness are the most. In fact, some of the strongest economies have the highest trade deficits. Foreign trade and economic growth in nigeria 1980 2010 1. Nigeria has enjoyed relatively strong economic growth over the past seven years but poverty is still a major concern. Attention is focused on this direction because of the fact that nigeria being a developing nation needs to pay more attention to her economic growth and development.
Impact of foreign direct investment and trade on economic growth. Foreign trade helps in accelerat ing the development of. This paper examined the effects of foreign direct investment fdi on the development of nigerian economy. Foreign direct investment, economic growth, ols, cbn, nigeria introduction. Ayashagba and abachi 2002 investigate on the effects of foreign direct investment on economic growth from 1980 to 1997. Ogbokor 2001, investigated the macroeconomic impact of oil exports of oil exports on the. This study examines the nexus between foreign trade and economic growth in nigeria using quarterly timeseries data for 1981q1 through 2010q4. The impact of chinese investment and and trade on nigeria. Exports and government revenues are driven largely by oil, while most nigerians work in agriculture. Pdf the study examined the impact of foreign trade on economic growth in nigeria.
Sectoral composition of fdi in nigeria, 19702001 percentage 12. In nigeria some authors had examined the performance of foreign trade and economic growth. For instance, oyejide 1974, using nigeria, as a laboratory test ground that an increase in export proceeds could lead to an expansion. However and in contrast to the above, sekou 2015 in his study utilised ordinary least square method to estimate. The impact of international trade on economic growth in.
The russian economy has shown significant signs of recovery, and is expected to exit recession in 2017, as recession appears to be bottomingout, reflecting the effect of higher oil prices. The study investigates the relationship between foreign direct investment flows and economic growth in nigeria. Uwazie, igwemma and eze 2015 examined the impact of foreign direct investment on economic growth in nigeria. Introduction over the last 15 years, china has become a major economic partner of subsaharan african countries. The study analyzed the impact of foreign direct investment on nigeria economic growth over the period of 199920. Other objectives includes to ascertain the viability of fdi for promoting growth in nigeria and to examine the factors that determine locational choice of foreign direct investment in nigeria. The work covered a period of 19812009 using an annual data from central bank of nigeria statistical bulletin. The study became necessary because as never before, the civilian governments since 1999 have employed several strategies to ensure increased flow of fdi into nigeria because of its perceived benefits as lauded in the theoretical literature as the panacea for economic. May 05, 2019 this study investigated the impact of foreign direct investment on economic growth in nigeria. Thus a gap exists in the area of foreign exchange reserves accumulation which this paper wants to investigate. This page provides nigeria capital flows actual values. Furthermore, over the years, development economists have long recognized the role of trade in the growth process of national economies as trade provides both foreign exchange earnings and market stimulus, for accelerated economic growth.
Foreign direct investment is assumed to benefit a developing country like nigeria, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. In addition to the global price of crude oil falling to a year low in january 2016 figure 1. Impact of international trade on the economic growth of nigeria. Foreign trade figures of nigeria economic and political. International trade and economic growth in nigeria. The results show that there is a stable, long run relationship between foreign trade and economic growth. The study examines the impact of foreign trade on economic growth in nigeria and india as well as the direction of causality between foreign trade and economic growth in the countries. Economic growth is constrained by inadequate infrastructure, electricity, incentives, and policies that promote private sector development, and poor access to quality education. Aug 30, 20 foreign trade and economic growth in nigeria 1980 2010 1. Contribution of international trade to economic growth in. Babcock business school, economics and banking and finance department, ilishan. While there are many studies investigating the impact of foreign trade on economic growth at the country level.
Secondary source of data was employed in this study from 1986 to 2017 which were sourced from central bank of nigeria statistical bulletin 2017 published in 2018 and world development indicator published in 2019. However, there are few literatures on the impact of fdi on agricultural sector development. In view of this, the study aims to provide evidence on the effect of international trade on nigeria s economic growth. Foreign direct investment inflow and agricultural sector.
The study foreign direct investment for development attempts primarily to shed light on the second issue, by focusing on the overall effect of fdi on macro economic growth and other welfareenhancing processes, and on the channels through which these benefits. The objectives of this study were to ascertain the impact of export trade on the nigerian economy and to. This paper examines the impact of chinese foreign direct investment and bilateral trade with nigeria economic growth. An empirical investigation was conducted using time series data on real gross domestic product, external debt stock, external debt payments and exchange rate from 19802012. Nigeria economic outlook top 10 themes for 2019 disclaimer this document has been prepared for general guidance on matters of interest only, and does not constitute professional advice. This page provides nigeria gdp annual growth rate actual values, historical data, forecast, chart, statistics, economic. Openness to trade and available human capital, however, are not fdi inducing. This economic update provides an overview of recent developments in the nigerian economy.
Nigerian foreign policy and economic development, 1999. The impact of foreign direct investment on the nigerian economy. The paper employs granger causality test and ordinary least square method. Pdf impact of international trade on economic growth in. The research was focused on the external reserves management and its effects on economic growth of nigeria.
Download nigerias economic recovery defining the path for economic growth by q217, the nigerian economy exited recession recording a positive growth rate of 0. The below mentioned article provides a close view on the role of foreign trade in economic growth. This study investigates the empirical relationship between foreign direct investment and economic growth in nigeria. It is also wise to say that the economic growth and development of a country largely depends on how its imports exchange for its exports. This pdf is a selection from an outofprint volume from the national.
Strong economic growth therefore advances human development, which. More specifically the paper investigates the effects of foreign exchange reserves accumulation on selected macroeconomic variables namely economic growth. The study also examines the relationship between inflow of fdi and economic growth in nigeria. A multivariate regression approach was employed to estimate augmented growth.
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