IMPACT OF GOVERNMENT EXTERNAL FINANCING ON ENERGY INFRASTRUCTURE IN NIGERIA

Abstract

Successive governments in Nigeria have relied on borrowing to finance critical public sector investment  programmes especially for energy infrastructure; despite this financing strategy however, a large gap still exist between energy infrastructure supply and its demand. This study examined the impact of government external financing on energy infrastructure in Nigeria. The specific objectives were to: to determine the impact of government multilateral external financing on energy infrastructure growth in Nigeria, to evaluate the impact of government bilateral external financing on energy infrastructure growth in Nigeria., to investigate the impact of government domestic financing on energy infrastructure growth in Nigeria, and to ascertain the impact of external debt servicing on energy infrastructure growth in Nigeria. The researcher adopted the ex post facto research design and used time series data covering from of 1991-2021. The ordinary least squares regression (OLS) technique was employed to estimate the parameters. The findings indicated that government multilateral external financing has significant positive impact on energy infrastructure growth in Nigeria, government bilateral external financing has significant positive impact on energy infrastructure growth in Nigeria, government domestic energy infrastructure financing has significant positive impact on energy infrastructure growth in Nigeria, external debt servicing has significant negative impact on energy infrastructure growth in Nigeria. Based on the findings, the study recommended that the energy sector should be improved upon to ensure that electricity energy consumption is not hindered by way of constant blackouts, government should explore more bilateral external financing to enhance funding for energy infrastructure growth, here is need for increased domestic energy infrastructure financing in order to aid the growth of the economy, the debt servicing should be repositioned in such a way as to reduce its negative effect on providing financing for energy infrastructure growth.