ABSTRACT
dy are; to determine the causes of the global financial crisis, to ascertain the effects of global financial crisis, to suggest measures that would be taken to manage the impact of global financial crisis in Nigeria. Primary and secondary data were used, the population of the study was 1200 from which the sample size of 400 were determined using Taro Yamani’s formula. The research instruments used were questionnaire and oral interview. The reliability of the research instruments were tested using Pearson Product moment correlation coefficient; the result gave a reliability index of 0.98 indicating a high degree of consistency. Chi-square and correlation analysis were the statistical tools used. The findings from the study reveals that, decline in oil prices and revenue, increase government expenditure and decline in market indices are the challenges posed by financial crisis in Nigeria; consumption-based economy, poor savings, high credit culture and huge financial outflow are the causes of the global financial crisis in Nigeria; reduction in direct foreign investment and oversea development assistance are the effects of global financial crisis to Nigeria and finally, diversification of the economy, robust regulatory policies and professional supervision of financial crisis in Nigeria. Based on the findings, the researcher made the following recommendation: Nigeria should adopt tough policy measures as effective strategies towards a comprehensive strengthening of the financial service sector, government should ensure that policy recommendations are implemented in order to reposition the Nigerian economy against the impact of global financial crisis, government should create enabling environment to attract foreign investors in order to boost economic activities in the country. Finally, government needs to sincerely focus on developing/strengthening the economy and provide alternative sources of revenue on a sustained basis.
TABLE OF CONTENTS
Title Page … … … … … … … … … i
Certification … … … … … … … ii
Approval Page … … … … … … … iii
Dedication … … … … … … … … … iv
Acknowledgements … … … … … … … … v
Abstract … … … … … … … … … vi
Table of
Contents … … … … … … … … vii
List of Tables … … … … … … … ix
CHAPTER ONE: INTRODUCTION
- Background of the Study … … … … … … 1
- Statement of the Problem … … … … … … 1
- Objectives of the Study … … … … … … 2
- Research Questions … … … … … … … 2
- Research Hypotheses … … … … … … … 3
- Scope of the Study … … … … … … … 3
- Limitations of the Study … … … … … … 4
- Significance of the Study … … … … … … 4
- Definition of Terms … … … … … … … 4
References … … … … … … … … 6
CHAPTER TWO: REVIEW OF RELATED LITERATURE
- Origin and Meaning of Global Financial Crisis … … 7
- Nature and Types of Global Financial Crisis … … … 8
- Major Causes of Global Financial Crisis … … … … 9
- Transmission of the Crisis to Nigeria … … … … … 12
- Challenges of Global Financial Crisis … … … … 13
- Effect of Global Financial Crisis in Nigeria … … … 15
- Consequences of the Global Financial Crisis … … … 18
- The Bad News and Good News of the Global Financial Crisis in Nigeria 20
- Steps Taken to Control the Crisis and it Responses … … 21
- Solutions to the Impact of Global Financial Crisis in Nigeria … 24
References … … … … … … … … 26
CHAPTER THREE: RESEARCH
METHODOLOGY
- Area of the Study … … … … … … … 27
- Sources of Data … … … … … … … 27
- Population of the Study and Sample Size Determination… 27
- Description of Research Instruments … … … … 30
- Validity of the Research Instrument … … … … … 30
- Reliability of the Research Instrument … … … … 30
- Method of Data Analysis … … … 32
References … … … … … … … … 34
CHAPTER FOUR: DATA PRESENTATION, ANALYSIS
AND INTERPRETATION
- Analysis of Questionnaire Distributed and Returned … … 35
- Testing of Hypotheses … … … … … … 40
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
- Major Findings … … … … … … … 49
- Conclusions … … … … … … … … 49
- Recommendations … … … … … … … 50
Bibliography … … … … … … … … … 51
Appendix I … … … … … … … … … 52
Appendix II … … … … … … … … … 56
LIST OF TABLES
Table 4.1: Questionnaire Distributed, Returned
and Not Returned … 35
Table 4.2: Sex Distribution of the Respondents … … … 36
Table 4.3: Educational Qualification of the Respondents … 36
Table 4.4: Staff Category of the Respondents … … … 37
Table 4.5: Working Years of the Respondents … … … 37
Table 4.6: The Challenges of the Global
Financial Crisis in Nigeria … 38
Table 4.7: The Causes of the Global Financial Crisis … … 39
Table 4.8: The Effect of Global Financial Crisis to Nigeria … 40
Table 4.9: Measure that would be taken to manage
the Impact of
Global Financial Crisis in Nigeria … … … … 41
Table 4.10: A Contingency table (reproduced
from table 4.6) for hypothesis testing 42
Table 4.11: A
contingency table (reproduced from table 4.7) for Hypothesis I 44
Table 4.12: A
contingency table (reproduced from table 4.8) for Hypothesis II 46
Table 4.13: A
contingency table (reproduced from table 4.9) for Hypothesis III 47
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
Nigeria is
interlinked with global financial system. As such global financial crisis which
was originated from the year 2007 mainly in U.S.A and spread in the latter part
of the year 2008 among developed nations and subsequently shifted to developing
nation has impact on the domestic economy of Nigeria. The country is in a
difficult situation as it faces, imbalances, lack of transparency in the
financial markets and non-applicability of domestic safety net.
The
government has been facing the impact of global financial crisis on the
domestic economy. Nigeria
is a part of the global economy, as such she has to face the danger of the
global financial crisis, which has both micro and macro impact all over the
World.
The
current global financial and economic crisis started as a series of malfunction
in the financial markets, leading to credit and liquidity crises, which led to
the collapse of several ‘big’ financial institutions, together with the loss of
confidence in the banking sector. It further transmitted to the real sectors,
leading to decline in aggregate demand and bringing about negative growth and
job losses. The scale and speed of transmission of the crisis and its attendant
consequences presented huge global challenge such that it has been variously
described in such extreme vocabulary as “global financial meltdown”, “global
economic meltdown”, “global credit crunch” and so on.
A
financial crisis is often characterized by credit crunch an disorderly
contraction in money supply and wealth creation. A credit crunch occurs when
participants in an economy lose confidence in having loans as well as recall
existing loans. The great depression occurred after a dramatic expansion in
debt and money supply in the 1920’s. Then, an equally dramatic contraction
occurred between 1929 and 1933 as debt was default upon and resulted in a
contraction in money supply and wealth.
The
latest financial crisis, which has metamorphosed into a global economic crisis,
similarly has its origin in rapid risky debt accumulation. The spread of the
crisis, also now referred to as global financial meltdown, across the globe due
to the fact that the world economy has become highly interconnected as a result
of the forces of globalization operating through the network of global economic
and social linkages. The domestic economy is linked to the rest of the world
economy through three markets, namely, goods market, factor market and assets
market (money and financial market). The rest of the world influences each of
this market and hence the domestic economy. Thus, although the current crisis
has derived from a credit crunch in the United States, It has spread to
both develop and developing countries through trade and financial linkages. And
implications have tended to be the same in the economies affected by the
crisis.
- STATEMENT OF
THE PROBLEM
THE EFFECT OF GLOBAL FINANCIAL CRISIS ON NIGERIAN ECONOMY
