Empirical and Evidence-Based Investigation: External Debt, Poverty and Economic Growth Nexus

Abstract

This study analyses the relationship among external debt, poverty and economic growth in Nigeria using annual time series data for the period 1986 through 2016 and employing a multivariate regression approach to estimate the augmented growth model specified. It was revealed that external debt is negatively and significantly related to economic growth. Also, positive and insignificant relationship between external debt service and economic growth was observed. There posit a positive significant relationship between exchange rate and economic growth. Finally, the empirical findings of this study shows positive significant relationship between per capita income (a measure of poverty level) and economic growth. However, an evidence-based survey conducted shows that the target beneficiaries did not actually benefit from the various poverty alleviation programmes set up in the country. In that light, government must build on already existing civil society groups, community-based organisations and their activities where possible when delivery services and resources to rural areas and communities in poverty and adequate financial markets access and strong bond market must be ensured by government to fortify the mechanism for efficient management of its debts.