EXTERNAL DEBT, DEBT SERVICE, AND GROWTH DYNAMICS IN SUB-SAHARAN AFRICA

Authors

  • Oseji Akpors Sunday Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria Author
  • Olawunmi Omitogun Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria Author
  • Osisanwo G. Bukonla Olabisi Onabanjo University, Ago-Iwoye, Ogun State, Nigeria Author

Keywords:

Debt Service, Debt Overhang, External Debts, Economic Growth

Abstract

This study examined the relationship between external debt, debt service, and economic growth in Sub-Saharan Africa from 1996 to 2024. Grounded in the Solow-Swan neoclassical growth framework, the study employed the Cross-Sectional Autoregressive Distributed Lag model to estimate short- and long-run effects of debt accumulation on growth. The Westerlund cointegration test confirmed a long-run equilibrium relationship. Findings revealed that both external debt and debt service exert negative but statistically insignificant effects on economic growth. The study highlights the importance of prudent borrowing, fiscal discipline, debt transparency, and productive investment in infrastructure, education, and healthcare.

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Published

2025-12-01

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Section

Articles