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Rivers State University, Port Harcourt.
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| Title: | The Effect of Foreign Trade Financing on Economic Development in Nigeria |
| Author(s): | CHINDA C. C. |
| Abstract: | 1981 to 2022. The study makes use of secondary data (time series) from various sources which include; the Central Bank of Nigeria Statistical Bulletin and Annual Report (various issues), and World Development Indicators. Variables used for the study include Deposit Money Banks‘ Credit to Export Trade, Deposit Money Banks‘ Credit to Import Trade, Nigeria Export and Import Credit, Letter of Credit, and Exchange Rate as explanatory variables, while per Capita Gross Domestic Product, Life Expectancy Rate and Literacy Rate Serve as the dependent variables. The Eview10.5 Software was used to empirically and econometrically analyze data and ARDL was used as the method of estimation. The findings from the result showed that Neximc bank credit has a positive effect on gross domestic product in the short run and a negative effect in the long run, an increase in export trade credit has a positive effect on per capita gross domestic product, deposit money banks credit to import trade has a positive effect on per capita gross domestic product, issuance of the letter of credit hurts per capita gross domestic product, an appreciation of the exchange rate hurt per capita gross domestic product, deposit money banks credits to export and import trades hurts life expectancy rate in the short run and has a positive effect in the long run, Neximc bank loans have a positive effect on life expectancy in Nigeria. Finally, deposit money banks credits to export and import trades hurts literacy. The study concludes that international trade financing using deposit money bank loans affected economic development negatively through its influence on economic growth and literacy and had an unstable effect on the life expectancy rate. The study therefore recommends that import trade should be more on capital-intensive goods where Nigeria has a disadvantage in either production or expertise, credit to the private sector should be channelled into the production of capital goods and services which will attract more foreign exchange into the country and before the adoption of the import substitution policy, efforts should be made to promote or improve the quality of education in Nigeria. |
| Keywords: | Foreign trade financing, Economic development, Nigeria, and ARDL |
| Journal: | Journal of World Economics and Financial Report Vol 1 No 1 |
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