THE RELATIONSHIP BETWEEN ECONOMIC GROWTH AND DISAGGREGATED PUBLIC DEBT IN NIGERIA

Abstract This study examined the disaggregated impact of public debt on economic growth in Nigeria, focusing on domestic debt, external debt, and debt servicing. Using the Autoregressive Distributed Lag (ARDL) bounds testing approach, the study analyzed annual time-series data from 2005 to 2024. The findings reveal that domestic debt has a positive and significant impact on economic growth, while external debt has a negative and significant effect. Debt servicing is found to have a positive and significant relationship with economic growth, suggesting that proper debt servicing enhances fiscal descipline. The findings imply that policymakers should prioritize productive domestic borrowing, efficient debt management, and fiscal discipline to promote economic growth in Nigeria. Accoringly, the study recommends sustainable domestic borrowing, cautious external borrowing, and debt restructuring to reduce debt servicing burdens.