ABSTRACT

The study investigated the ofeffect ofdebt burden and debt service payment on economic growth ofNigeriafor the period 1981-2018 with specific objectives namely; to determine the impact of external debt burden on economic growth ofNigeria, to determine the impact ofdomestic debt burden on economic growth ofNigeria and to ascertain the impact ofdebt service payment on economic growth of Nigeria.. The specified model was estimated using the Autoregressive Distributive lag Model to determine the level ofimpact that one variable has on the other. While E-views 10 statistical software was employed in computing the result, time series data were obtainedfrom World Bank national accounts data and OECD National Accounts datafiles and the study established that external debt has a positive relationship with economic growth for the current year in the short run but statistically insignificant and also in the long run, Debt Service Payment to external debt has a positive relationship with RGDP at the current year and in the first lagperiod, but was significant at only in the 1st lag period and insignificant in the long run, Domestic Debt had a positive relationship with RGDP in the current year and statistically significant and also significant in the long run and study recommended that the Debt Management Office should strengthen their plans and ensure that external loans be taken only if needed in critical capital areas that must be strictly monitored. And other areas offinancing such as Concession byforeign governments andfinancial institutions should be pursued and that the government of Nigeria should use her accumulated external foreign reserves instead of incurring more external debts, as this will ensure increase in real economic growth and reduce capitalflights through repayments ofdebts to external sources