Globalization and the South: Implications for Trade, Financial Integration and Foreign Direct Investment in Emerging African Economies (Published)
This paper analysed the effects of the wave of globalization on trade, financial integration and foreign direct investment (FDI) in the context of African economies. The study selected three African economies: Nigeria, Kenya and South Africa to illustrate the purpose of the study. Adopting a content analysis approach, the study synthesizes secondary data from the period 2000–2024 obtained from the World Bank, IMF, and UNCTAD with a qualitative review of contemporary academic and policy discourse. Results suggest that although globalization promoted trade openness and capital flow over the years till date, the impacts on development were not totally positive. Although there have been changes to trade policy, the export profile has changed a little bit but the dependence on primary commodities remains and this limits industrialization. Financial integration has facilitated access to foreign capital but also has resulted in increased external debt and vulnerability to global economic shocks. FDI, with all its potential benefits, is so far a volatile and resource based activity, with very limited spillover into local economies. The evidence in this study implies that globalization is not a sufficient condition for sustainable growth, but its beneficial effects are conditioned on having strong domestic institutions and a diversified economy, as well as a coordinated policy. The paper contends that in the absence of deliberate policies to enhance productive capabilities and governance, globalization may deepen structural dependence, not broad-based development in Africa.
Keywords: Financial Integration, Foreign Direct Investment, Globalization, Trade Liberalization, emerging African economies
Effect of Trade Liberalization on Economic Development in Nigeria, 1980-2013 (Published)
The study explores the relationship between trade liberalization and economic growth in Nigeria. Two equations were estimated in which index of industrial production proxied as yearly average capacity utilization as a function of degree of openness, terms of trade and real export. Similarly, in the second equation, real gross domestic product as a function of degree of openness, terms of trade, real export and trade liberalization dummy was estimated. A vector error correction model was employed for the study in which results show that openness of the foreign sector and trade liberalization dummy have positive significant impact on both industrial performance and economic growth in Nigeria within the period under review. The paper therefore recommended for the removal of all known impediments to trade such as excessive import levies and arbitrary tariffs.
Keywords: Cointegration, Index of Industrial Production, Real Gross Domestic Product, Trade Liberalization, Vector Error Correction Model