Global Journal of Human Social Science, E: Economics, Volume 22 Issue 7

Table 4.6: Auto regressive Distributed Lag (ARDL) Regression Results Variable Coefficient Prob. Value C 0.20 0.95 EDT(-1) 0.76 0.00*** EXR -0.03 0.05** CAD -0.16 0.61 FSD -3.04 0.01*** INT 0.15 0.32 ISG -0.33 0.24 R-squared 0.89 Adjusted R-squared 0.87 F-statistics 41.68 Prob (F-statistics) 0.00*** Durbin-Watson stat. 1.93 Note: ** and *** represent 5% and 1% significance levels respectively Source: Author’s Computation (2022) V. C onclusion and R ecommendations Based on the dual gap theory, the study examined the impact of fiscal deficit, private financing gap, current account deficit and other control variables on external debt in Nigeria; from 1981 to 2020. Correlation analysis, granger causality test and ARDL results showed that fiscal deficit is astrong predictor of external debt in Nigeria. The study concludes that fiscal deficit, exchange rate, previous debt profile significantly impacts external debt servicing in Nigeria. Hence, government should ensure that excess expenditure leading to fiscal deficit should be efficiently used for productive and income generating public investments. Public policy should be directed towards export promotion in order to check the exposure to exchange rate fluctuations and devaluation effects on import dependent economies like Nigeria. Finally, in order to close the investment-saving gap, interest rate should be reduced. R eferences R éférences R eferencias 1. Abula, M. and Ben, D. M. (2016). The impact of public debt on economic development of Nigeria. Asian Research Journal of Arts & Social Sciences, 1(1): 1-16. 2. Abdulkarim, Y. and Saidatulakmal, M. (2021). The impact of government debt on economic growth in Nigeria, Cogent Economics & Finance, 9:1, 1946 249, DOI:10.1080/23322039.2021.1946249 3. Adegboyo, O. S., Efuntade, O. O., and Efuntade, A. O. (2020). Fiscal deficit and growth in Nigeria economy. KIU Interdisciplinary Journal of Humanities and Social Sciences , 1(3), 146-160. 4. Adetokunbo, A. M. and Ebere, C. E. (2019). Determinants and Analysis of Domestic Debt in Nigeria: 1970-2015 Acta Universitatis Danibius CECONOMICA 15 (2). 5. Ajayi, I. E. and Edewusi, D. G. (2020). Effect of Public Debt on Economic Growth of Nigeria: An Empirical Investigation. International Journal of Business and Management Review, 8 (1), pp. 18-38 6. Akamobi, O. G. and Unachukwu, I. B. (2021). Macroeconomic Effects of Budget Deficit in Nigeria. European Journal of Economic and Financial Research 4 (4) pp 128-153. 7. Alejandro, D. J., and Ileana, R. J. (2017). The impact of government debt on economic growth: An overview for Latin America. Department of Economics, University of Perugia (IT), Working Paper, 28, 1-11. 8. Aladejana, S. A., Okeowo, I. A., Oluwalana, F. A., and Alabi, J. A. (2021). Debt Burden and Infrastructural Development in Nigeria. International Journal Academic Research in Business and Social Sciences, 11(1), 419–432. 9. Aminu, U., Ahmadu, A. H. and Salihu, M. (2013). External Debt and Domestic Debt Impact on the Growth of the Nigerian Economy. International Journal of Educational Research, 1(2) pp 70-85. 10. Ayuba, K. I. and Mohd Khan, S. (2019). Domestic Debt and Economic Growth in Nigeria: An ARDL Bounds Test Approach. Economics and Business, 33, 50-68. 11. Boyce, P. (2020) Budget Deficit Definition. Boycewire.com 12. Chukwu, L. C., Otiwu, K., and Okere, P. A. (2020). Impact of Budget Deficit on Nigeria’s Macro- economic Variables: 1980-2012. International Journal of Science andManagement Studies, 3 (4) pp 135-150. 13. Efuntade, A. O., Olaniyan, N. O., and Efuntade, O. O. (2021). The Impact of Debt Service in Stimulating Economic Growth in Nigeria: Mediating on its Role on Public Sector Financial Management. Acta Universities Danubius CECONOMICA. 14. Eke, C. K. and Akujuobi, N. E. (2021). Public Debt and Economic Growth in Nigeria: An Empirical Investigation. International Journal of Development and Management Review 16 (1): 178-192. Volume XXII Issue VII Version I 42 ( ) Global Journal of Human Social Science - Year 2022 © 2022 Global Journals E Implication of Fiscal Deficit Financing on External Debt Sustainability in Nigeria