Skip to main content
Kent Academic Repository

The impact of financial liberalisation on the economic performance of selected countries in sub-Saharan Africa

Fowowe, Babajide (2006) The impact of financial liberalisation on the economic performance of selected countries in sub-Saharan Africa. Doctor of Philosophy (PhD) thesis, University of Kent. (doi:10.22024/UniKent/01.02.94356) (KAR id:94356)


The theory of financial liberalisation advocates the ‘freeing up’ of financial markets in order to stimulate savings, investment, and ultimately economic growth. This is to be achieved by eliminating financial repression and letting the market allocate savers funds to investors. Both the quantity and quality of investment are expected to increase and these should lead to higher rates of economic growth. Financial liberalisation was embarked upon by many counties in Sub-Saharan Africa (SSA) from the mid-1980s into the 1990s and most of the literature about these experiences has been purely theoretical. The objective of this thesis is to examine the impact of financial liberalisation on the economic performance of 19 countries in SSA over the period 1975 - 2000.

Financial liberalisation is measured by four proxies. These are 2 liberalisation proxies that take account of the gradual progression in financial liberalisation policies, a dummy variable that takes on a value of 1 in the year that major moves towards liberalisation started, and the real rate of interest. Panel data techniques are employed in estimating savings, investment, and growth equations.

Our results show that financial liberalisation has not had the desired effect on the economic performance of countries in SSA. It is found that financial savings, private investment, total investment, and economic growth have had a negative relationship with financial liberalisation. The only variable which showed a positive relationship with financial liberalisation was national saving.

A case study for Nigeria showed that in the long run financial liberalisation has had a positive effect on financial savings and economic growth thus lending credence to the view that financial liberalisation causes distortions and crisis in financial markets in the short run, but is beneficial to economic growth in the long run.

Item Type: Thesis (Doctor of Philosophy (PhD))
DOI/Identification number: 10.22024/UniKent/01.02.94356
Additional information: This thesis has been digitised by EThOS, the British Library digitisation service, for purposes of preservation and dissemination. It was uploaded to KAR on 25 April 2022 in order to hold its content and record within University of Kent systems. It is available Open Access using a Creative Commons Attribution, Non-commercial, No Derivatives ( licence so that the thesis and its author, can benefit from opportunities for increased readership and citation. This was done in line with University of Kent policies ( If you feel that your rights are compromised by open access to this thesis, or if you would like more information about its availability, please contact us at and we will seriously consider your claim under the terms of our Take-Down Policy (
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: Divisions > Division of Human and Social Sciences > School of Economics
SWORD Depositor: SWORD Copy
Depositing User: SWORD Copy
Date Deposited: 14 Jul 2023 09:27 UTC
Last Modified: 14 Jul 2023 09:27 UTC
Resource URI: (The current URI for this page, for reference purposes)

University of Kent Author Information

  • Depositors only (login required):

Total unique views for this document in KAR since July 2020. For more details click on the image.