INTERNATIONAL TRADE AND ENVIRONMENTAL DEGRADATION NEXUS IN NIGERIA

Abstract

Given the rate of degradation of the natural environment, as well as the continuous increase in 
international trade, this study seeks to determine the relationship between international trade 
and environmental degradation in Nigeria from 1982 to 2023. The study was anchored in the 
framework of the Stochastic Impacts by Regression on the PAT (STIRPAT) model. It adopted 
the Autoregressive Distributed Lag (ARDL) model to estimate the long-run relationships 
among indicators of international trade and environmental degradation. The bounds test for 
cointegration showed the existence of a long-run relationship among international trade, 
environmental policy, trade policy and environmental degradation for the period reviewed. The 
findings revealed that trade openness, real GDP and urbanisation had a significant positive 
impact on environmental degradation in Nigeria, while environmental policy, trade policy and 
technological advancement had a negative and significant impact on environmental 
degradation in Nigeria. The study therefore concludes that, in Nigeria, there exists a positive 
relationship between international trade and environmental degradation and a negative 
relationship between environmental policies, trade policies and environmental degradation. It 
therefore recommends that the adoption of cleaner and sustainable technologies in industries 
through incentives be encouraged while maintaining good environmental regulations.