THE IMPACT OF THE GLOBAL FINANCIAL MELTDOWN ON THE POLITICAL ECONOMY OF AFRICA: A CASE STUDY OF NIGERIA (2008 – 2010)
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Abstract
The global economic and financial crisis/ meltdown which the whole world witnessed in the past few years, took a toll on Nigerian and African economies. This project research work examines its impacts and implications. In the course of doing this, the paper looks at its origin/causes, global spread factors), polices responses and of course some possible recommendations for more effective and positive results, in order to insulate African's and Nigerian's economies from possible future occurrence of the financial crises. Consequently, in exploring this subject matter, this paper examins the impact and policy responses starting with Western economy of Europe and America, it then trickles down to the African gradual economic integration to the global economy, right from the colonial era, and the ripple effects of the global financial doom on the economic sectors of African which are; real sector, financial sector, fiscal sector and external sector, focussing on foreign exchange market.
Furthermore, it moves down to Nigerian political economy, highlighting the impact and the recovery prospects from the oil sector. Finally, the research carried out, examined and interpreted a survey finding which was undertaken by the researcher to ascertain and substantiates the causes, spread, impact of the financial crunch/ downturn and the level of the potency of policy responses to ameliorate the negative impact. The result of the survey shows that, corruption, sharp practices, greed, inadequate financial managerial skill and knowledge by the financial regulators and institutions among others caused the global liquidity squeeze and economic integration (globalization) as being responsible for its global spread and also that there is a fair awareness of the impact among Nigerians. Some viable policy prescriptions and recommendations were therefore proffered, like, building a virile economy through indiginization of financial and economic reforms, increasing measures to deter and checkmate greed and sharp practices by financial institutions and regulators, employment of professionals and experts in economic and financial sectors together with regular and periodic training on latest operation techniques, taking the issue of economic diversification and fiscal discipline seriously to ensure resilient self reliant economy, among others.
Furthermore, it moves down to Nigerian political economy, highlighting the impact and the recovery prospects from the oil sector. Finally, the research carried out, examined and interpreted a survey finding which was undertaken by the researcher to ascertain and substantiates the causes, spread, impact of the financial crunch/ downturn and the level of the potency of policy responses to ameliorate the negative impact. The result of the survey shows that, corruption, sharp practices, greed, inadequate financial managerial skill and knowledge by the financial regulators and institutions among others caused the global liquidity squeeze and economic integration (globalization) as being responsible for its global spread and also that there is a fair awareness of the impact among Nigerians. Some viable policy prescriptions and recommendations were therefore proffered, like, building a virile economy through indiginization of financial and economic reforms, increasing measures to deter and checkmate greed and sharp practices by financial institutions and regulators, employment of professionals and experts in economic and financial sectors together with regular and periodic training on latest operation techniques, taking the issue of economic diversification and fiscal discipline seriously to ensure resilient self reliant economy, among others.
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