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Illicit Trade of Natural Resources and Economic Growth in Nigeria

Author

Listed:
  • Ishaku Rimamanung Nyiputen

    (Department of Economics, faculty of social science, Federal University Wukari Taraba State, Nigeria)

  • Adeyemo Olulayo Elizabeth

    (Department of Economics, faculty of social science, Federal University Wukari Taraba State, Nigeria)

Abstract

Natural resources, both renewable and non-renewable, and ecosystem services are a part of the real wealth of nations. They are the natural capital out of which other forms of capital are made. They contribute towards fiscal revenue, income, and poverty reduction. Sectors related to natural resources use provide jobs and are often the basis of livelihoods in poorer communities. Owing to this fundamental importance of natural resources, they must be managed sustainably. Government plays the essential role in putting into place policies that ensure that resources contribute to the long-term economic development of nations, and not only to short-term revenue generation, high-quality institutions in the present, and planning for the future. This study investigated the impact of illicit trade of natural resources and economic growth in Nigeria. The data involved for the study were growth rate of gross domestic product (GDPR), shadow economy as a share of GDP (SDGDP), formal economy as a share of GDP (FMEGDP), corruption perception (CORR), and government effectiveness (GOVEF). This research’s analysis proceeded from the descriptive statistics which involved a summary statistic of the quantitative behaviour of the variables included in the model. Furthermore, the Augmented Dickey Fuller (ADF) unit root test was conducted to verify the stationarity of the study’s data. on Nigeria economic growth. The research was carried out under the assumption that natural resources deemed to impact level of economic growth of Nigeria The study made use of Secondary data from 1991 to 2021. Given the empirical findings in this study, it was concluded that the size of the adverse effect generated from the illicit trade in natural resources, corresponds to the substantial enhancing effect of the formal sector on the growth of the Nigerian economy. Specifically, revenues generated in the illicit trade of resources significantly and adversely affect the growth of the Nigerian economy.

Suggested Citation

  • Ishaku Rimamanung Nyiputen & Adeyemo Olulayo Elizabeth, 2025. "Illicit Trade of Natural Resources and Economic Growth in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(3s), pages 7884-7902, October.
    • Handle: RePEc:bcp:journl:v:9:y:2025:issue-3s:p:7884-7902
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    References listed on IDEAS

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