Impact of External Debt on Economic Growth in Nigeria (1981–2020)

This study examined the impact of external debt on economic growth in Nigeria (1981-2020). The study was built on a multiple regression. The focus variables are real gross domestic product as the dependent variable while external debt, exchange rate, inflation rate and domestic debt are the independent variables. The Ordinary Least Square (OLS) technique was used in estimating the relationship between the dependent and independent variables. From the result from the analyses indicates that external debt has no significant impact on economic growth in Nigeria and thus insignificant variable in determining economic growth in Nigeria. The result also shows that external debt has negative relationship with economic growth in Nigeria. The granger causality test result also shows that there is no causality relationship between external debt and economic growth in Nigeria. In view of the results of this study, the study recommends that the cost of governance should be reduced so as to enable proper utilization of the available funds for development purposes and an enabling environment must be created to enhance investment in the Nigerian economy