International Trade Policy Indicators and Economic Performance in Nigeria

Osain; E. R.; Amadi; C. R.; Ozuzu; S. C.R.

doi:10.56201/ijefm.v11.no7.2026.pg116.128

📄 Download Paper

International Trade Policy Indicators and Economic Performance in Nigeria

Osain, E. R., Amadi, C. R., Ozuzu, S. C.R.

Abstract

This study investigates the empirical relationship between international trade policy indicators and macroeconomic performance in Nigeria over the period 1990–2023, using real gross domestic product as the indicator of macroeconomic performance. The analysis employs the export diversification index, tariffs, quotas, and trade openness as explanatory variables, with data sourced from the World Development Indicators and the Central Bank of Nigeria . The methodology includes descriptive statistics, unit root tests, the ARDL bounds cointegration test, ARDL estimation, and residual diagnostic tests. Results from the Augmented Dickey–Fuller test reveal a mix of I(0) and I(1) variables, while the ARDL bounds test confirms a long- run equilibrium relationship between real GDP and the independent variables. The ARDL long- run estimates show that the export diversification index has no statistically significant positive impact on real GDP. Quotas exhibit a negative but not significant effect on real GDP. Tariffs have a statistically significant negative impact on real GDP, whereas trade openness has a positive but not statistically significant effect on real GDP. Based on these findings, this study recommends among others that tariff policies should be selectively adjusted to protect strategic infant industries while avoiding excessive protectionism that hinders trade efficiency and economic growth.

Keywords

Tradeeconomic performancereal GDP and ARDL

References

Abinabo, P., & Abubakar, A. (2023). Trade openness and economic growth in Nigeria. Nigerian Journal of Management Sciences, 24(2), 217- 228. Adeagbo, A. (2020). Contemporary issues in trade and trade policy in Nigeria. Culminating Projects in Economics, Economic Review, 9(1), 33–45 Agbarakwe, U. H., & Donatus, F. (2023). Trade policy and manufacturing sub-sector output in Nigeria (1986-2020). Global Academic Journal of Humanities and Social Sciences, 5(5) 217-235. Ager, P., & Hansen, C. W. (2016). National immigration quotas and local economic growth. https://doi.org/10.2139/ssrn.2866411 Ajala, M. A. & Lawal, W. A. (2023). Trade openness and the implications for agricultural output in Nigeria. African Journal of Sustainable Agricultural Development, 4(2), 1-10. Aninwagu, V. O., Onyema, J. I., Momodu, A. A., & Amadi, C. R. (2024). Fiscal deficit and economic growth in Nigeria. http://dx.doi.org/10.2139/ssrn.5358923 Central Bank of Nigeria (2023). Quarterly Statistical Bulletin.https://www.cbn.gov.ng/out/2023/std/2023q2%20statistical%20bulletin_contents %20adnd%20narratives_final.pdf Datta, K. (2021). Impact of tariff war on world economy especially after WTO: A time series econometric enquiry. https://doi.org/10.1108/978-1-80071-314-720211006 Duhu, I. G. (2022). Impact of export diversification on economic growth in Nigeria. Saudi Journal of Economics and Finance, 6(1), 18-28 https://doi.org/10.36348/sjef.2022.v06i01.004 Effiong, U., & Orebiyi, P. (2023). Export diversification, financial sector development, and economic growth: empirical evidence from the West African Sub-Region. https://doi.org/10.48185/sebr.v4i2.865 International Monetary Fund. (2021). Nigeria: 2021 Article IV consultation - Press release; Staff report; and statement by the Executive Director for Nigeria (IMF Country Report No. 21/46). Washington, DC: International Monetary Fund. Kumbhakar, S., Gudbrand, L., Flaten, O., & Tveterås, R. (2008). Impacts of Norwegian milk quotas on output growth: A modified distance function approach. Wiley Blackwell, 59(2), 350-369. Leemput, E. V., & Ferraro, J. K. (2019). Long-run effects on Chinese GDP from U.S.-China tariff hikes. https://doi.org/10.17016/2380-7172.2382 Mutiu, A. A. (2022). Trade policy and economic growth in Nigeria. AUDOE. 18(2), 112-125. Obaji, S. I., Ogbonna, B. C. & Atuma, E. (2022). Trade policies and industrial sector performance in Nigeria 1970 – 2019. Economic and Business Review, 3(3), 120- 131. Ohwofasa, B. O. & Ekaruwe, M. (2023). Trade openness and economic growth in Nigeria. Lafia Journal of Economics and Management Sciences, 8(1), 23-47. Tyokosu, M. O., & Abakpa, N. (2023). The relationship between trade openness and economic growth in Nigeria from 2000 to 2020. International Journal of Research and Innovation in Social Science , 7(11), 1766- 1778. Umar B., Hawwa, A. A., Nazeef, B. H., & Yahaya, Y.M. B. (2021). Impact of trade openness on economic development in Nigeria. International Journal of Intellectual Discourse , 4(2), 303-312. World Bank (2023). Broad money (% of GDP) – Nigeria. https://data.worldbank.org/indicator/FM.LBL.BMNY.GD.ZS?locations=NG World Bank. (2017). Doing business 2011: Making a difference for entrepreneurs – Comparing business regulation in 183 economies. Washington, DC: World Bank Group. https://openknowledge.worldbank.org/handle/10986/2489 World Trade Organization. (2015). Trade policy review: Nigeria. Geneva: WTO. https://www.wto.org/english/tratop_e/tpr_e/tp456_e.htm

International Trade Policy Indicators and Economic Performance in Nigeria

Abstract

Keywords

References

More Articles from INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT