The Impact of Financial Development on Economic Growth in Sudan

Authors

  • Chol Deng Akol Jomo Kenyatta University of Agriculture and Technology-Kenya
  • Prof. Timothy Okech Jomo Kenyatta University of Agriculture and Technology-Kenya

Abstract

The paper sought to investigate the Impact of Financial Development on Economic Growth in Sudan during the period of 1990–2014. The research is intended to detect whether the financial development has contributed positive role or not on economic growth in Sudan during the period of last 24 years, using Augmented Dickey Fuller Test to figure out the availability of Unit root in the variables. Then after applying the Johnsen co-integration test the empirical results of the test have shown the association and positive impact of the money supply and banking credit to private sector on economic growth(GDP) in Sudan which discovered out the short and long run relationship between financial development and economic growth. The test shows the positive association between financial development and economic growth in Sudan which led to run the (VECM). The result of Vector Error Correction Model identified statistically significant of money supply and bank credit to private sector on economic growth. However, the financial sector is in needed for dramatic reforms in term of formulation of banking capital, effective financial regulations and balance in distributing banking credit to the most productive sectors of the economy. According to the figures (1) and (2) that showed the diagram of real GDP and GDP per capita in Sudan. The separation of South Sudan from Sudan was a great choke that hit Sudan’s economic growth severely, especially in the first and second year of the separation. But Sudan still has capacity to put its economic growth into right track if the political crisis resolved and investment’s opportunities open to the world.

Keywords: Financial, Development, Economic, Growth, Bank, Credit, Capital, Political, Instability, GDP.

Author Biographies

Chol Deng Akol, Jomo Kenyatta University of Agriculture and Technology-Kenya

Graduate Candidate

Prof. Timothy Okech, Jomo Kenyatta University of Agriculture and Technology-Kenya

Lecturer

References

Abdul M, (2015). Determining the relationship between Financial Development and Economic Growth, an application to Singapore.

Ahmed M. K. A, (2014). The Effect of Financial Development on Economic Growth in Sudan. University of Bakht Al Ruda.

Alexei K, (2001). Financial Reformed in Sudan, IMF working paper. Assessment based on an application of the Autoregressive Distributed Lag (ARDL) Model. Aristotle University of Thessaloniki and LEAP (Greece). BETA – Theme, University of Strasbourg (France).

Dilip, K. (2010). The Evolution and Unfolding of Financial Globalization .World Bank 2013 , Financial Development Report.

Hussein A. A & Collins G. N (2015). Financial Development and Economic Growth in China.

Idries J. T & Zu’bi M. F. A (2012). Evaluating the Impact of Financial Development on Economic Growth in Jordon.

John G . G & E . S . Show (1955). Financial Aspects of Economic Development

Joseph A . S , (1911). Farsighted Vision on Economic Development . The American Journal of Economics and Sociology , Vol. 61.

Kabir Mohammed K . H, Benito S & Jung-Suk Y, (2001). Financial Development and Economic Growth in the Organization of Islamic Conference Countries .

Marti C, Asli D , Erik F & Ross L, (2010). Financial Development in 205 Economies from 1960 to 2010

Nicholas K, (2009). The link between Financial Development and Economic Growth in Uganda

Nicholas M. O, (2015) , The Impact bank base and market base Financial Development on Economic Growth. Time-Series evidence from the UK.

Robert E. L, (1988). Mechanics of Economic Development. Journal of Monetary Economics 22 , 3- 42

Robert G. K & Ross L, (1993). Finance and Growth: Schumpeter might be Right

Rodgers A. M & Eliud M, (2014). The Relationship between Financial Development and economic Growth in Africa , Kenya Institute for Public Policy and University of Cape Town, South Africa

Ross L, (2005). Finance and Growth: Theory and Evidence

Ross. L (1997). Financial Development and Economic Growth : View and Agenda. Journal of Economic Literature. Vol. XXXV .

Suliman Z. S & Hala A . D, (2011). , Stock Market Development and Economic Growth in King Saudi University (Saudi Arabia) and University of Bakht Al ruda (Sudan)

Susanne R. A (2003). The and Effects of Financial Development on Economic Growth: An Empirical Approach

Downloads

Published

2020-05-21

How to Cite

Akol, C. D., & Okech, P. T. (2020). The Impact of Financial Development on Economic Growth in Sudan. Journal of Finance and Accounting, 4(1), 54–71. Retrieved from https://stratfordjournals.org/journals/index.php/journal-of-accounting/article/view/492

Issue

Section

Articles