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International financial risk, investment and growth in Nigeria Pat Donwa* and Osaro Agbontaen** This study analyzes the impact of international finance risk and domestic investment on the levels of growth in the Nigerian economy. Essentially, the researchers adopted the ARDL approach of the co-integration method taking into consideration macroeconomic variables such as exchange rate volatility which was used to represent international financial risk. Investment was captured by gross capital formation and real GDP growth in order to determine the short-run and long-run dynamics associated with international financial risk and investment in relation to economic growth in Nigeria. In order to specify an appropriate model for this research, the structural and the political changes of Nigeria through the period of financial deregulation, trade liberalization and the present financial sector reform were considered. The variables used in the model indicated basic statistical significance levels and it was noticed that the present levels of international financial risk seriously distorts the levels of growth in the economy. Also, one period lagged investment inhibits growth and growth at its second lag slows present levels of economic growth. Therefore, the impact exhibited by international financial risk, the first lag value of investment and the second lag value of economic growth exhibited negative impacts on the present levels of growth in the Nigeria economy. This indicates that distortions as a results of fluctuations in international financial risk and the levels of uncertainties in the previous levels of investment and growth shrinks the present levels of growth in the economy. This study has implications for investors, scholars and policy makers. Key words: Economic growth, policy regulation, growth analysis JEL code: F43, G28, L51, R11 _________ *Senior Lecturer, Department of Accounting, University of Benin, Benin City, Edo State. **Research Assistant, Department of Accounting, Economics and Finance, Lagos Business School, Lagos State, Nigeria.