TREND DYNAMICS OF FOREIGN DEBT ON ECONOMIC GROWTH IN NIGERIA

In developing nations, there is a huge question of why should they borrow further. This is a result of the increasing debt profile of countries like Nigeria. As much as there is a rationale for borrowing in these countries, there is need to establish the relationship between debt, debt service and economic growth in Nigeria. This is the main thrust of the study. The study with CBN financial report data from 1985-2020 used descriptive and inferential statistics of tables, figures, and cointegration test with correlation method to establish the pattern of relationships. The study found that debt and debt service profile has been on the increase in escalating scale. The study also found a cointegrating equation trend in the model. Hence, establishing a long-run relationship among them in the Nigerian economy. The study recommends further borrowing should be on projects that can pay back any borrowing within its lifespan.