EFFECT OF CAPITAL FLIGHT IN THE NIGERIAN ECONOMIC SECTOR (1981-2015)

¹Tony IkechukwuNwanji, ²Wilson Ozuem³Kerry E. Howell, ⁴Sainey Faye, ⁵Adegbola OlubukolaOtekunrin, &⁶Damilola Felix Eluyela

^1,3,5,6Department of Accounting and Finance, Landmark University, Nigeria

²University of Cumbria and University of Warwick UK

³School of Business, Teesside University, UK.

⁴Department of Accounting and Finance, New University, Buckingham, UK

Email:¹nwanji.tony@lmu.edu.ng; ²wilson.ozuem@cumbria.ac.uk

³kerry.howell@northumbria.ac.uk;⁴sainey, faye@bucks.ac.uk,

⁵otekunrin.adegbola@lmu.edu.ng, ⁶eluyela.damilola@lmu.edu.ng

ABSTRACT

This research paper deal with the effect of capital flight(here after referred as KF) in the Nigerian economic sector covering 35 years (1981-2015).The studyrecognized the extent to which KF affects growth in the economic sector of Nigeria. The study identifies the problems Nigeria as a country face as a result of KF and proffers feasible solution which could be adopted by policymakers in Nigeria. We used secondary data from the Central Bank of Nigeria statistical bulletin. Thestatistical bulletin covers the economic indicators including Gross Domestic Product (GDP), External Debt, Foreign Direct Investment (FDI,)KF,Current Account Balance (CAB) and Exchange Rates (EXCHRATE) which are thevariablesfor the study. We also used data from the Annual Abstract of Statistic of the National Bureau of Statistics (here after referred as NBS). We employeda Time Series Quantitative methodfor the analysis. The study found that the number of financial resources transferred out of Nigeria as the KF is significant. Therefore, the government would try as much as possible to curb KF to enable the development of the Nigerian economy. The study adds to the existing literature and empirical knowledge of the impact of KF on the Nigerian economic sector. This study shed light on the current account balance of Nigeria. This study alsofound thatNigerian import outweighs export even with the government agricultural policy. This study identified the KFas one of the significant reasons, or over-import and under-export in Nigeria.

Keywords: Capital Flight, Foreign Direct Investment, Economic Sector, Economic Growth, Financial Resources Nigerian Economic and QuantitativeMethod.