Oil Price and Exchange Rate Volatility in Nigeria

Nigeria being a mono-product economy, where the main export commodity is crude oil, changes in oil prices has implications for the Nigerian economy and, in particular, exchange rate movements. The latter is mostly important due to the double dilemma of being an oil exporting and oil-importing country, a situation that emerged in the last decade. The study examined the effects of oil price, external reserves and interest rate on exchange rate volatility in Nigeria using annual data covering the period 1970 to 2011. The theoretical framework of this study is based on Generalized Autoregressive Conditional Heteroskedasity modeled by Tim Bolerslev (1986) and Exponential General Autoregressive Conditional heteroskedastic modeled by Daniel Nelson (1991). These models were used to estimate the relationship between oil price changes and exchange rate. Relevant descriptive and econometric analyses were employed. The econometric tests adopted include the unit root tests, Johansen co-integration technique and the Vector Error Correction Model (VECM); the time series property examined shows that all the variables were stationary at first difference. The long run relationship among the variables was determined using the Johansen Co-integration technique while the vector correction mechanism was used to examine the speed of adjustment of the variables from the short run dynamics to the long run. It was observed that a proportionate change in oil price leads to a more than proportionate change in exchange rate volatility in Nigeria; which implies that exchange rate is susceptible to changes in oil price. The study therefore recommend that the Nigeria government should diversify from the Oil sector to other sectors of the economy so that Crude oil will no longer be the mainstay of the economy and frequent changes in crude oil price will not influence exchange rate volatility significantly in Nigeria

Is Aid Really Dead? Evidences from Sub-Saharan Africa

This study examined the relationship between foreign aid and economic development in Sub Saharan Africa. The study seeks to examine the role of institutions in aid effectiveness in SSA countries by adopting a theoretical framework similar to the Endogenous/New Growth model and the System Generalized Method of Moments (GMM) technique of estimation in order to overcome the challenge of endogeneity perceived in the institution variables and Aid-Growth argument. It was observed that foreign aid does not significantly influenced Real GDP Per Capita in Sub-Saharan Africa, even after controlling for adequate rule of law and sound public institutions. In the same manner; capital stock, rule of law, control of corruption and Human capital enhanced economic performance while foreign aid failed to contribute meaningfully to economic development in SSA Countries

Electricity Consumption and Economic Development in Nigeria

The study examines the relationship between electricity consumption and economic development using an extended neoclassical model for the period 1970-2013. The study incorporates the uniqueness of the Nigerian economy by controlling for the role of institutions, technology, emissions, and economic structure in the electricity consumption-development argument. The study adopted a cointegration analysis based on the Johansen and Juselius (1981) maximum Likelihood approach and a vector error correction model. In order to ensure robustness, the study adopted the wald block endogeneity causality test to ascertain the direction of causal relationship between electricity consumption and economic development. The study found an existence of long-run cointegration equation with electricity consumption inversely related to economic development. Likewise, the vector error correction model failed to reject the null hypothesis of non-convergence in the long-run. Finally, the study found evidence supporting unidirectional causal relationship running from economic development to electricity consumptio

Is Aid Really Dead? Evidences from Sub-Saharan Africa

This study examined the relationship between foreign aid and economic development in Sub Saharan Africa. The study seeks to examine the role of institutions in aid effectiveness in SSA countries by adopting a theoretical framework similar to the Endogenous/New Growth model and the System Generalized Method of Moments (GMM) technique of estimation in order to overcome the challenge of endogeneity perceived in the institution variables and Aid-Growth argument. It was observed that foreign aid does not significantly influenced Real GDP Per Capita in Sub-Saharan Africa, even after controlling for adequate rule of law and sound public institutions. In the same manner; capital stock, rule of law, control of corruption and Human capital enhanced economic performance while foreign aid failed to contribute meaningfully to economic development in SSA Countries

Income Heterogeneity and Environmental Kuznets Curve in Africa

The Environmental Kuznets Curve (EKC) hypothesis asserts that pollution levels rises as a country develops, but reaches a certain threshold where pollution begins to fall with increasing income. In EKC analysis, the relationship between environmental degradation and income is usually expressed as a quadratic function with turning point occurring at a maximum pollution level. This study seeks to examine the pattern and nature of EKC in Africa and major income groups according to World Bank classification comprising low income, lower middle income and upper middle income in Africa. In ensuring the robustness of our study; the paper proceeded by ascertaining the nature of EKC in all fifty-three countries of Africa in order to confirm the results obtained from basic and augmented EKC model. The study could not validate EKC hypothesis in Africa (combined), low income and upper middle income but empirical and analytical evidences supports the existence of EKC in lower middle income countries. Likewise, evidences from the robustness checks confirmed the findings from the basic and augmented EKC model. The study could not attain a reasonable turning point as there are evidences that Africa could be turning on the EKC at lower levels of income. Also, there is need to strengthen institutions in order to enforce policies that prohibits environmental pollution and ensure pro-poor development agenda

Foreign Land Deals in Africa: Implications for Agricultural Trade

This study investigates the implications of foreign land deals in Africa especially with regard to agricultural trade. It is motivated essentially by large scale foreign deals of land in Africa, Latin America, Central Asia and Southeast Asia that have been reported in recent years. One of the driving forces has been attributed to the presumed availability of land in these regions. This study employs data sourced from World Development Indicators and World Governance Indicators on key variables such as arable land per person, agricultural land as percentage of land area, net food import, regulatory quality, among others (1995-2010) on selected African countries where instances of foreign land deals have been reported. The study formulates empirical models that draw from institutional development theory, which is estimated using the Generalized Method of Moments (GMM). The study found LSFLDs to impact negatively on agricultural export in selected countries, the indexes of institutional framework used were found to be significant; likewise, agricultural land becomes highly significant with relative larger magnitude when interacted with institutional indexes. This therefore implies that as more agricultural land is acquired, agricultural export tends to dwindle and incidences of food insecurity are heightened. The preliminary investigation suggests the need for controlling the issue of massive foreign land deals through viable institutional framework, which can be engendered by building sound legal and procedural measures that will protect local rights and take into account the aspirations of local farmers and the welfare of citizenry

Energy Access: Pathway to Attaining Sustainable Development in Africa

The study assesses the effect of energy use on social, economic and environmental sustainability in Africa. The energy sources considered in the study comprises four prominent sources in Africa, including: fossil fuel, solid fuel, electricity and natural gas consumption. The finding suggests that fossil fuel consumption and solid fuel constitute about 75 percent of energy use in the region and contributively worsen social and environmental conditions. The predominant consumption of these dirty energies has severely hampered child and adult survival and efficient delivery of services. Also, the time wasted in fetching biomass has constituted an impediment to learning capacities in children and women's mobility. In the same manner, frequent exposure to fumes from the dirty energy sources had resulted in severe indoor air pollution and rising incidence of pneumonia, lung cancer and chronic obstructive pulmonary diseases in women and children. On the other hand, the empirical and conceptual analysis shows that access to clean and reliable energy sources (such as electricity) reduce time poverty, enhance gender empowerment and reduce environmental degradation. The study recommends structural policy reforms and transformation towards decentralizing energy provisions and adopting off-grid power solution to rural areas. Furthermore, African governments need to develop a sustainable energy financing mechanism through an affordable pricing template; this can be achieved by increasing local contents in energy provision and increasing the share of abundant domestic resource in energy mix. Keywords: Energy Access, Structural transformation, Sustainable Development, Africa JEL Classifications: Q43, K32, Q01 DOI: https://doi.org/10.32479/ijeep.721

Energy Access: Pathway to Attaining Sustainable Development in Africa

The study assesses the effect of energy use on social, economic and environmental sustainability in Africa. The energy sources considered in the study comprises four prominent sources in Africa, including: fossil fuel, solid fuel, electricity and natural gas consumption. The finding suggests that fossil fuel consumption and solid fuel constitute about 75% of energy use in the region and contributively worsen social and environmental conditions. The predominant consumption of these dirty energies has severely hampered child and adult survival and efficient delivery of services. Also, the time wasted in fetching biomass has constituted an impediment to learning capacities in children and women’s mobility. In the same manner, frequent exposure to fumes from the dirty energy sources had resulted in severe indoor air pollution and rising incidence of pneumonia, lung cancer and chronic obstructive pulmonary diseases in women and children. On the other hand, the empirical and conceptual analysis shows that access to clean and reliable energy sources (such as electricity) reduce time poverty, enhance gender empowerment and reduce environmental degradation. The study recommends structural policy reforms and transformation towards decentralizing energy provisions and adopting off-grid power solution to rural areas. Furthermore, African governments need to develop a sustainable energy financing mechanism through an affordable pricing template; this can be achieved by increasing local contents in energy provision and increasing the share of abundant domestic resource in energy mix