PUBLIC DEBT AND ECONOMIC GROWTH IN NIGERIA (1987-2020)
PUBLIC DEBT AND ECONOMIC GROWTH IN NIGERIA (1987-2020)

Summary/Abstract: The study investigated the link between governmental debt and economic growth in Nigeria over a 34-year period (1987-2020). The survey examined the effect of external debt, domestic debt service payments, interest rates, and government spending on economic growth as measured by real GDP. The study used the least square econometric technique to determine the relationship between public debt variables and economic growth in Nigeria. Data on real gross domestic product, external debt, domestic debt service payment, interest rate, and government expenditure were gathered from the CBN statistical bulletin (2020). External debt and domestic debt service payments have a negative and substantial influence on economic growth, interest rates have a positive and insignificant effect on economic growth, and government expenditure has a positive and significant effect on economic growth, according to the study. The study indicated that Nigeria's public debt had a negative link with economic growth based on the findings. As a result, debt office management is attempting to put in place mechanisms to ensure that loans are used for the purposes for which they were acquired and channeled towards productive uses, and sourcing external debts should be viewed as a means of long-term development rather than a means of solving short-term problems.

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