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THE EFFECT OF EXTERNAL DEVELOPMENT ON THE NIGERIA ECONOMIC GROWTH (1989-2010)

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THE EFFECT OF EXTERNAL DEVELOPMENT ON THE NIGERIA ECONOMIC GROWTH (1989-2010)

 

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The accumulation of external debt is a common phenomenon of the third World countries at the stage of economic growth and development where the supply of domestic savings is low, current account payment deficit is high and import of capital is needed to increase domestic resources.

The management of Nigeria’s external debt has been a major macroeconomic problem especially since the early 1980s. For many years now, the country’s debt has been growing in spite of the efforts being made by the Government to manage and minimize its crushing effects on the nation’s economy. Such efforts range from the various refinancing and restructuring agreements to debt conversion programme and the deliberate allocation of substantial resources towards servicing the debt. Of particular concern to the authorities, is the heavy debt burden it imposes when compared with the country’s debt service capacity.

 

In recent years, however, some observers have held different perceptions about Nigeria’s capacity or otherwise to service her debt.

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