IIARD International Institute of Academic Research and Development

INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT (IJEFM )

E-ISSN 2545-5966
P-ISSN 2695-1932
VOL. 2 NO. 1 2017

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Impact of Global Financial Crisis on Nigerian Economy (2000 - 2015)

Richard C. Osadume & Alexander U. Mbachu (Ph.D)

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Abstract

The recent financial crisis in Europe and America had had its effects on the rest of the world owing to economic and financial globalization. The ripple impacts are still believed to be felt today. This paper examines the Impact of Global Financial Crisis on the Nigerian Economy covering 2000 – 2015. The objective of this study is to assess the Impact of the global financial crisis on four key variables in the Nigerian economy namely Gross Domestic Product, stock market Capitalization, Foreign Direct Investments and Export Earnings from Crude oil. The study used the Unit Root Test, Ordinary Least Square and Vector Autoregression method to test and analyse the secondary data obtained from world bank and the Central Bank of Nigeria and the findings showed that the Global Financial Crisis had significant impact on Nigeria affecting its Gross Domestic Products, stock market capitalization, Foreign Direct Investments and Export Earnings from Crude oil. The paper recommends options to mitigate the crisis, which include Bail-out of key sectors of the economy through massive injection of funds to revive and reduce poverty effects of the crisis. It also recommends that the financial and stock Regulatory authorities should bring down transaction costs in institutions regulated to boost business activities while government embarks on serious diversification of the economy from oil dependence. JEL Classification: F650 Economic impacts of Globalization: Finance

keywords:

Financial Contagion, Financial Crisis, Stock market capitalization, Foreign Exchange rate, Foreign Direct Investments, Export Earnings, International Business, Credit

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