TRADE OPENNESS AND ECONOMIC GROWTH IN NIGERIA, 2013-2025: AN EMPIRICAL ANALYSIS

Abstract

This study examines the relationship between trade openness and economic growth in Nigeria over the period 2013-2025 using Ordinary Least Squares (OLS) regression analysis. Drawing on annual data sourced from the World Bank, the Central Bank of Nigeria, and the IMF, the empirical model regresses real GDP growth on trade openness, foreign direct investment (FDI), and the headline inflation rate. The Augmented Dickey-Fuller (ADF) unit root test and a suite of diagnostic tests confirm model validity. Results reveal that trade openness exerts a statistically significant positive effect on GDP growth (β = 0.312, p < 0.05), FDI contributes positively though at the 10% level (β = 1.847, p < 0.10), and inflation significantly suppresses growth (β = –0.089, p < 0.05). The model explains 62.8% of the variation in GDP growth (R² = 0.628; F = 5.055, p = 0.029). These findings support the export-led growth hypothesis and carry direct policy implications for Nigeria's trade liberalisation agenda, AfCFTA implementation, and macroeconomic stabilisation strategy.