Original Research Article

MODELING THE DYNAMICS OF CRUDE OIL PRICES AND ITS INTERACTION WITH EXCHANGE RATE IN NIGERIA

AJIBOLA, ISAIAH OLUFEMI, NWEZE, NWAZE OBINI, O. ADENOMON, MONDAY

Journal of Economics and Trade, Page 1-13

The advent of the coronavirus pandemic and the global recession that occurred has generated sincere interest from researchers and stakeholders on how the oil price dynamics affect Nigeria's exchange rate performance. This interest is carved from the high volatility during this period and the failure of many countries to cope with this, plunging many, including Nigeria, into economic recession. Coronavirus disrupted the global supply of commodity goods and services which crashed significant markets, including the crude oil market. In the mild stage of the pandemic, the oil price, which stood at $67.12 per barrel on 2 January 2020, went down to $12.22 on 22 April 2020 and became $40.91 as of 22 October 2020. As a result of these incidences, this study examines the dynamism of oil price on the crude oil market's performance and exchange rate. Using the monthly data spanning from 2000m1 to 2020m6, the study employed Toda-Yamamoto model to derive the impulse response function, Variance decomposition, and granger causality. Implications from the findings reveal that Macroeconomic global fundamentals primarily control the Nigerian stock market. Specifically, when the oil price becomes volatile and unpredictable, investors prefer to hold cash rather than invest into the market during an uncertain time. The findings reveal that the exchange rate is also strongly influenced by oil price shock only and not oil price volatility. Besides, the exchange rate responds negatively to oil price shocks but positively to oil price volatility. However, the result of the granger causality shows that the oil price volatility control on the exchange rate is not significant.

Original Research Article

FINANCIAL DEEPENING AND SELECTED NON-OIL SECTORS GROWTH IN NIGERIA: ARDL ANALYSIS AND VECM

PAUL NDUBUISI

Journal of Economics and Trade, Page 14-24

This paper explores the causal impact of financial deepening over the period 1993Q1–2020Q4 on the contribution of the Wholesale and Retail, Service and Construction sectors to economic growth in Nigeria, using a co-integration research method of Auto-regressive distributed lag (ARDL). Managed for possible effects in these non-oil sectors of crude oil prices and openness to trade, the study identified statistically significant financial deepening to drive long-term and short-term economic growth across the three non-oil sectors. Overall, the results stress Nigeria's financial intermediary system in terms of mobilizing and allocating capital as well as stimulating private sector economic activities in non-oil sectors. Therefore, the establishment of intermediation in the financial sector may be the right strategy for raising the domination of the Nigerian oil industry.

Original Research Article

THE DYNAMICS OF REGIONAL INFLATION RATES IN NIGERIA

NNADEDE AUGUSTINE CHINATU, OBINI NWEZE

Journal of Economics and Trade, Page 37-49

The absence of price control in Nigerian and the attitude of retailers have resulted in the inflation rates not showing any specific pattern. Consumers have relied on day to day price fixation by retailers who may at any point in time decide what price items are sold in the market. This has in turn caused differences in inflation rates in the regions of the country. The national government pays little or no attention since its main interest is concentrated on the national inflation rate. National Bureau of Statistics through its prices division collects prices data which is used to produce state price indices. In a bid to investigate the reasons for the fluctuations in the inflation rates, the state index series available at the National Bureau of Statistics are used to compute state inflation rates for all the states. The already existing regional structure of the country was used to compute average inflation rates of states under each region which was used to generate a multiple regression model of inflation rates for the regions which revealed that North West and South east have minimum contributions to the rising inflation rates in Nigeria. Notwithstanding the above result, the study was able to discover that the North dominate in contributing to the rise in inflation rates in Nigeria. Hypothesis tested using Analysis of variance however concluded that there is no significant difference in the means of inflation rates of the regions during the period under study.

Original Research Article

IMPACT OF COVID-19 ON WEST AFRICA INTRA-TRADE: EVIDENCE FROM BENIN’S CROSS-BORDER TRADE

ALASTAIRE SENA ALINSATO, CALIXE BIDOSSESSI ALAKONON, NASSIBOU BASSONGUI

Journal of Economics and Trade, Page 50-57

The economic damages of the pandemic of COVID-19 due to measures adopted to control the spread of the virus continue to affect countries across the world and rise the need for scholars to provide adequate information to policymakers to guide the implementation of adequate responses. Meanwhile, the spatial heterogeneity of the spread of COVID-19 and the heterogeneity in countries’ resilience capacity support the relevance of country-level studies instead of cross-countries studies. This article aims to study the effect of the COVID-19 pandemic on Benin's bilateral trade. Based on monthly data from January 2020 to March 2021, the Poisson pseudo maximum likelihood method was used to estimate a gravity model. Our results showed that the capacity of COVID-19 to harm Benin's bilateral trade is much greater when apprehended by the restrictive measures than by the lethality of the pandemic, suggesting that restrictions on interactions are more harmful to trade than the risks of mortality linked to the spread of the disease. However, our results revealed the non-persistence of these effects, which are gradually absorbed over time, reflecting a better ability of economies to adapt to the pandemic.

Review Article

PICTOGRAPHIC INTEGRAL OF CHALLENGES AND PROSPECTS OF CASHLESS FRUGALITY IN NIGERIA

AJIBOLA, ISAIAH OLUFEMI, NWEZE, NWAZE OBINI, ATANYI, EMMANUEL YUSUF, AYOMOH EBO EVE

Journal of Economics and Trade, Page 25-36

Cashless frugality in Nigeria is an effort towards cashless transactions by reducing physical cash usage. The aim of the paper is to present the position of Nigeria being a cashless society and ascertain the challenges and prospects which are related with such transactions.

 The data sets of all thirty-six (36) states and the Federal capital territory (FCT) was used. Secondary data was gathered from Central Bank of Nigeria (CBN) statistical database/website as well as the Nigeria Interbank Settlement System (NIBSS) website. The data were analysed and symbolised graphically. The outcomes exhibited the introduction of cashless frugality in Nigeria is a step in the right direction which propelled frugality growth and development. In addition, the challenges, and prospects of cashless Nigeria in promoting electronic cash instruments and improving automated economic facilities was emphasized.