Economic Policy Choices and Economic Growth of Nigeria: Lessons from the Asian Pacific

International Journal of Multidisciplinary Approach Research and Science E-ISSN 2987-226X P-ISSN 2988-0076 Volume 3 Issue 01, January 2025, Pp. 335-344 DOI: https://doi.org/10.59653/ijmars.v3i01.1405 Copyright by Author Economic Policy Choices and Economic Growth of Nigeria: Lessons from the Asian Pacific Goddey Obuareghe1*, Jude Dike2 Dennis Osadebay University, Asaba, Nigeria1 Dennis Osadebay University, Asaba, Nigeria2 Corresponding Email: * Received: 27-12-2024 Reviewed: 10-01-2025 Accepted: 27-01-2025 Abstract This study examined the effect of economic policy choices on the growth of Nigeria with specific reference to the Asian Pacific from 1994 to 2022 (i.e. 29 years). Specifically, the study covered three (3) variables. The three economic policy variables are broad money supply, total trade and government revenue. The three economic policy variables accounted for monetary, trade and fiscal policy measures. Meanwhile, the economic growth proxy is considered to be real gross domestic product (RGDP). Data were retrieved from the Central Bank of Nigeria Statistical Bulletin, 2022. The robust regression analysis was suitable for the study. The study confirmed that the broad money supply negatively affects economic growth. However, total trade and government revenue positively affected economic growth. Overall, the study concludes that economic policy choices have a mixed effect on the growth of the Nigerian economy. As such, the Nigerian government should use its monetary policy tools to curb excess cash from circulation. Further, efforts should be made to reduce some trade barriers that mitigate successful trading in Nigeria. Lastly, the Nigerian government should reappraise the country's current trade policies, as this may be the main reason the Nigerian economy is still underdeveloped. Keywords: Economic Growth, Real Gross Domestic Product, monetary policy, fiscal policy, trade policy, Policy Choices, Asian Pacific Introduction For any economy to be able to provide a well definite degree of economic growth and the intention of the country to experience least amount of instability in the macro-economy is a process of policies adopted by the government and the specific actions taken by the Central Bank of that country. Subsequently, after two decades, the Nigeria economy have experience what is called 'recession 'which started in 2016, displaying adverse economic panics, contradiction economic policies and also experiencing security issues (Chakravarty, 2017). However the Asian financial crisis played a role in opening us to detect some of the unknown 335 International Journal of Multidisciplinary Approach Research and Science structural problems amid the quick economic growth of most of the Eastern part of the Asian countries especially the errors they made in their macro policies and it's defect on their financial systems. Nevertheless this made it a forcing task that prompted the international communities to have a change and enhanced the international financial system, and also to make sure there is safety smoother operation in the international financial market. Although policies have been adopted and changed occasionally in other to proffer solution and come up with a corrective measure to the unstable economy. In Nigeria, the task of making policies to fit in, in all sphere of the government, industries that possess crucial and significant economic elements and ministries are channelled to the Federal Government and the Central Bank of Nigeria (Bende-Nabende, 2018). CBN is faced with the task of facilitating monetary policies for the financial sector of the economy while the Federal Government is tasked with concurrence with other relevant agencies to propose relevant policies that best fit the industries. Few of the challenges faced by the Nigeria economy has been the problem of surplus liquidity, systematic changes in the foreign reserve, stagnancy of GDP, yearly budget deficit, uncertainty of inflation rate, inconsistency in exchange rate and untapped revenue deriving source not including revenue derived from crude oil resulting in several systems of fiscal and monetary policies to develop in Nigeria Mlachila (2018). In stabilizing prices in Nigeria the most techniques adopted are the expansionary and the contractionary method, but still the nation lacks rapid economic growth and the issue of lack of development still persists in the country. This study tends to accommodate the recent financial disruption that reminds us that economics panics are not a go-easy process. Hence, it aimed to determine the procedure by which economic policy impacts economic growth. Positivism economics was adopted to evaluate the effectiveness of economic policies. These clarified how both the economy and the economic policies are interrelated, without turning to value judgment, and about which result is best. Accordingly, economics policies are glimpse in terms of trade policy and macroeconomic stabilization policies. Trade policies are seen as tariff, and trade treaties with other policies that are proposed in other aid the promotion of trades activities by incorporating supply side policies which can increase productivity. According, Morakinyo (2018), the intention to stabilize the supply of money in other not to cause high inflation, and to slow down the business cycle, calls for the development of macro-economic stabilization policies. In this view, this study seeks to investigate the impact of economic growth on policy choices with reference to Asian experience. Literature Review Conceptual Clarification In mid-1997, an experienced occur that sparked the Asian borders. International bettors traded in a large volume the Thailand Baht, which greatly disrupted the Thai financial system. On July of that same particular year, Thailand agreed on changing the fixed exchange rate into a floating rate, resulting in a sudden devaluation of Thailand money by a very big margin, 336 Economic Policy Choices and Economic Growth of Nigeria: Lessons from the Asian Pacific which led to currency devaluation in various southern Asian countries. In October of that same year this financial crisis stretched to two other countries: the Republic of Korea and Japan, resulting in currency depreciation, bankruptcy experienced by big companies and great fall on the stock market. In the following the financial crises grew worse and deeper to the extent of having effect on Russian and most Latin America countries and areas, which bring about the instability and result to political unrest. However China was not greatly affected by the financial crisis, and fortunately for China they were able to cope and regulates it is economic and financial stable, with regards to the financial policy and several control measures undertaken by the authorities. In easing off their financial crisis the Chinese governmental authorities employed various pro-active policies such as; (i) the Chinese government u (...truncated)