Beyond the Oil Boom: Assessing the Impact of Oil Dependency on Nigeria’s Long-term Economic Growth
Abstract
This research analyzed the effects of oil dependency on Nigeria's long-term economic growth between 2012 and 2022. Time series data on variables such as oil rents dependency, fuel import dependency, fuel export dependency, monetary policy rate, and annual growth of gross domestic product were utilized. The research utilized the Autoregressive Distributed Lagged model to analyze the short- and long-term relationships between oil dependency and economic growth in Nigeria. The findings suggest that dependency on oil rents exhibited a positive and significant impact in the long term, dependency on fuel imports indicates a positive and insignificant correlation while fuel export dependency demonstrated a negative and significant effect in the long term. Based on the findings, it is recommended to invest in the development of sectors such as agriculture, manufacturing, and services to decrease reliance on oil. Furthermore, effective management of oil revenues and investment in infrastructure and human capital are critical for achieving sustainable economic growth. Enhance transportation and logistics infrastructure to support domestic production and distribution of energy resources, thereby minimizing reliance on imports. Additionally, value addition is necessary. Rather than investing in raw fuel, one should invest in refining capacity to enhance the value of exported products.
Keywords
Oil dependency, Dutch Disease, Resource-Based Growth, Economic growth, Nigeria
Citations
IRE Journals:
Ebele Igwemeka C. , Eje Grace C. , Chinwe Olelewe
"Beyond the Oil Boom: Assessing the Impact of Oil Dependency on Nigeria’s Long-term Economic Growth" Iconic Research And Engineering Journals Volume 8 Issue 9 2025 Page 1284-1298
IEEE:
Ebele Igwemeka C. , Eje Grace C. , Chinwe Olelewe
"Beyond the Oil Boom: Assessing the Impact of Oil Dependency on Nigeria’s Long-term Economic Growth" Iconic Research And Engineering Journals, 8(9)
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