Impact of Chinese Trade and Investment on Nigeria’s Economic Growth
Leonard Nosa Aisien Ph.D; Erediauwa Adesuwa (Mrs)

Abstract
The growth effect of China trade with Sub-Sahara Africa countries has generated a lot of controversies in recent times. Nigeria is a major trading partner with China and also one of the highest recipient of foreign direct investment (FDI) in Sub-Sahara Africa. This study therefore, examines the growth impact of trade and FDI inflow from China on Nigerian economy using annual time series data covering the period 1994 to 2017. The study relied on the cointegration and error correction modelling technique to ascertain the short run and long run effects of trade and FDI inflows from China on Nigeria’s economic growth. Statistical facts from the study revealed that imports from China dominate the trade relation between Nigeria and China throughout the period of analysis. Imports from China consist mainly of finished goods which include electrical and electronics equipment, vehicles, machines, aluminum, plastic products etc. the exports from Nigeria are mainly primary products dominated by crude oil. Also, about 75% of Chinese investment in Nigeria is in the oil and gas sector, indicating a lopsided investment in the oil and gas sector which have little linkage with other sectors of the economy. The results from the estimated model revealed that imports from China have significant and positive impact on Nigeria’s economic growth both in the short run and in the long run. The impact of FDI inflow from China was not a significant determinant of economic growth in Nigeria both in the short run and in the long run. Also, Export from Nigeria to China was only significant in the long run but with negative sign. This implies that the current export composition of Nigeria to China is not growth enhancing for Nigeria. It was therefore recommended among others that there should be a deliberate government policy to redirect FDI inflow to the non-oil sector of the economy.

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