The study empirically investigate the relationship between external debt, growth and development of the Nigerian Economy. The study covered a period of 31years from 1980 to 2010. Data on external debts for example Paris Club debts, London Club debts, Multilateral creditors, promissory notes and External debt service payment of Nigeria were used in establishing the relationship and the degree of significance. Multiple Regression analysis was used in order to establish the nature and Degree of the relationship between the independent variables and the dependent variable i.e. The Gross Domestic Product of Nigeria (GDP).
The study found out that external debts and external debt service payment significantly influence the Gross Domestic Product of Nigeria. The study, therefore, inferred that external debts in Nigeria have made Positive and Negative contributions to the growth and development of Nigeria Economy during the period covered by this study. However, the Nigerian government should investigate the reasons behind the negative contribution of external debt to the Gross Domestic Products of the country with a view to unveiling the bottlenecks and correct them. Efforts should be made to borrow with caution in order to avoid the negative side of external debts