Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries

This paper examines the effect of oil resource rents and economic complexity on the debt burden of five oil-rich Sub-Saharan African countries between 1995 and 2019. A panel autoregressive distributed lag estimation technique was used to estimate the models; the results reveal a negative an...

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Main Authors: Akinsola Motunrayo O., Akinsola Foluso A., Iwegbu Onyebuchi
Format: Article
Language:English
Published: Faculty of Economics, Belgrade 2025-01-01
Series:Ekonomski Anali
Subjects:
Online Access:https://doiserbia.nb.rs/img/doi/0013-3264/2025/0013-32642544035A.pdf
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author Akinsola Motunrayo O.
Akinsola Foluso A.
Iwegbu Onyebuchi
author_facet Akinsola Motunrayo O.
Akinsola Foluso A.
Iwegbu Onyebuchi
author_sort Akinsola Motunrayo O.
collection DOAJ
description This paper examines the effect of oil resource rents and economic complexity on the debt burden of five oil-rich Sub-Saharan African countries between 1995 and 2019. A panel autoregressive distributed lag estimation technique was used to estimate the models; the results reveal a negative and significant impact of economic complexity and natural resources rents on debt services of the selected oil-rich African countries. The paper also shows that using natural resources rents to enhance the complexity of the economy reduces public debt burdens. The implication is that greater economic complexity and natural resources rents may reduce the tendency of oil-rich countries to experience debt crises in the long run. The paper recommends that a greater deployment of natural resources rents for productive purposes may create a conducive investment climate, reducing the incidence of debt. Finally, policy makers in these economies should take advantage of natural resources rents to diversify their economies in order to deepen economic complexity and reduce the burden of public debt.
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spelling doaj-art-d3934bfbe3554815ae4f45e2c72a9e182025-08-20T02:14:00ZengFaculty of Economics, BelgradeEkonomski Anali0013-32641820-73752025-01-0170244355610.2298/EKA2544035A0013-32642544035AHarnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countriesAkinsola Motunrayo O.0https://orcid.org/0000-0002-9822-2888Akinsola Foluso A.1https://orcid.org/0000-0003-1392-0087Iwegbu Onyebuchi2https://orcid.org/0000-0002-2598-8102University of South Africa, Department of Economics, Pretoria, South AfricaUniversity of Lagos, Department of Economics, Lagos, NigeriaUniversity of Lagos, Department of Economics, Lagos, NigeriaThis paper examines the effect of oil resource rents and economic complexity on the debt burden of five oil-rich Sub-Saharan African countries between 1995 and 2019. A panel autoregressive distributed lag estimation technique was used to estimate the models; the results reveal a negative and significant impact of economic complexity and natural resources rents on debt services of the selected oil-rich African countries. The paper also shows that using natural resources rents to enhance the complexity of the economy reduces public debt burdens. The implication is that greater economic complexity and natural resources rents may reduce the tendency of oil-rich countries to experience debt crises in the long run. The paper recommends that a greater deployment of natural resources rents for productive purposes may create a conducive investment climate, reducing the incidence of debt. Finally, policy makers in these economies should take advantage of natural resources rents to diversify their economies in order to deepen economic complexity and reduce the burden of public debt.https://doiserbia.nb.rs/img/doi/0013-3264/2025/0013-32642544035A.pdfoil resource renteconomic complexitypublic debt burden
spellingShingle Akinsola Motunrayo O.
Akinsola Foluso A.
Iwegbu Onyebuchi
Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
Ekonomski Anali
oil resource rent
economic complexity
public debt burden
title Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
title_full Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
title_fullStr Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
title_full_unstemmed Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
title_short Harnessing resource rents for debt reduction: A study of oil-rich Sub-Saharan African countries
title_sort harnessing resource rents for debt reduction a study of oil rich sub saharan african countries
topic oil resource rent
economic complexity
public debt burden
url https://doiserbia.nb.rs/img/doi/0013-3264/2025/0013-32642544035A.pdf
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