The Impact of Export on the Economic Growth and Development of the Nigerian Economy (1980-1989)

Abstract

Nigeria today depends largely on imported products for the survival of her economy. It is a shame and a matter of urgent attention that this nation imports refined petroleum for domestic use. A trend analysis shows that the external sector of Nigeria’s economy has, since independence in 1960 been unstable, largely reflecting the persistent high domestic demand for foreign goods and services against the backdrop of inadequate foreign exchange earnings. For example, between 1960 and 1967 Nigeria experienced balanced of payment deficit except in 1965 when there was trade surplus. In the subsequent years 1968-1975 (except 1972) the overall balance reversed into surpluses owing to the impositions of restrictions on some external transactions. The surplus in 1974 was particularly remarkable because it reflected the peak performance of Nigeria’s balance of payments, occasioned by astronomical increases in the export price of crude oil. However, deficits re-occurred between 1976 and 1978 followed by surpluses in 1970 and 1980. The balance of payments witnessed an improvement between 1981 and 1986. But from 1986 to 1998 the balance of payment position has worsened. Against the backdrop of this trend analysis, one is forced to ask some vital questions: how does foreign trade affect the structure and character of less developed countries (LDCs) economic growth? This is the centre of the controversy whether trade is an engine of growth. Can less developed countries on their own determine how much they trade? In the light of past experience and prospective judgment, should less developed countries adopt an outward looking (free trade, expanded flow of capital and human resources ideals and technology etc) or an inward looking (protection in the interest of self-reliance). These questions are relevant and critical especially when posed in the context of the structure, pattern, and development aspiration of the developing countries. For the past decades, the Nigeria economy has been retrogressing. This ugly phenomenon has constituted a matter of serious concern to one and all.

Consequently, relevant authorities have been using monetary/fiscal tools like tariff structure, credit and exchange control, taxation, regulation of interests rates, quota etc to remedy the ills in the Nigerian economy. it is against this background that this study focuses on the tariff structure amongst others to gauge it effects on the Nigerian economy since 1980.