Growth Spillover Effects from Trade: A Case of Nigeria and Two Trading Partners

This study examines growth spillover effects from trade between Nigeria and two major trading partners; China and India. Using time series data approach, we analyze the trade-growth spillover effects on Nigeria’s economic growth over a period of forty years. The study employs Johansen co - integration test, Fully Modified Ordinary Least Squares regression model (FMOLS) and Granger Causality test for data analysis. Findings reveal that China’s imports have significant positive link with Nigeria's economic growth while, India’s export and import have significant positive impact on Nigeria’s economic growth. Granger causality test reveals that both imports and exports from both countries are drivers of the Nigerian economic growth. Based on these findings, we conclude that there is a positive growth spillover effects from trade between Nigeria and her two trading partners. The implications of these findings are significant for policymakers to shape trade policies with both countries to ensure continued positive spillover effects and economic performance through international trade.