NEXUS BETWEEN CLIMATE CHANGE AND PUBLIC DEBT SUSTAINABILITY IN NIGERIA

This study examines the relationship between climate change and public debt sustainability in Nigeria using an Autoregressive Distributed Lag (ARDL) approach. The study investigates both long-run and short-run dynamics to determine the impact of climate change variables including carbon emissions, rainfall, trade policy, inflation, and real interest rates on public debt. The findings reveal that while these variables do not significantly affect public debt in the long run, rainfall and trade policy exert significant short-term influences. The error correction term is weak, suggesting a slow adjustment process for Nigeria’s public debt system in response to climateinduced economic shocks. The study concludes that short-term climate fluctuations impact fiscal stability and recommends integrating climate resilience into debt management strategies. Key policy recommendations include strengthening climate-adaptive fiscal policies, diversifying revenue sources, enhancing infrastructure investment, and reforming debt management frameworks. These measures will improve Nigeria’s ability to manage climate-related economic shocks while ensuring long-term debt sustainability.