Nigeriaas Debt Burden and Development Tangle

Abstract

The main purpose of this research is to empirically ascertain the nexus of Nigeria's debt burden and development tangle. In order to embark on this exercise, relevant data were sourced from Central Bank of Nigeria statistical bulletin and National Bureau of Statistics fact book spanning the years . The Johansen test for the co-integrating association corroborates that a long run dynamic equilibrium link exists between economic development and debt stocks, and the Granger Causality result shows that the various debt stocks granger caused the performance of the Nigeria's economy. On the basis of our findings and conclusion thereof, and in the light of the need to encourage and promote economic development, a strategy that exercises tense embargo on fresh loans and advances should be put in place and the government should try by all means to reduce the quantum of public debt as well as its total eradication via debt buy back, total cancelling of the debt or complete repudiating of the debt stock. Policies that will promote increase in the volume of commodities export should be put in place by the government, which will boast earnings from foreign exchange and hence help to eliminate the huge deficit in the revenue account of the federation.