Nwaneri has joined Olympique Marseille in a straight loan to the end of the season.
Arteta said: "It’s something that we constantly have to be monitoring. I think the talented young players that we have need minutes, and in this case, Ethan wasn’t having enough minutes, and the last thing that we want is to cut his development because he’s such a talent and someone who lives and breathes football; that’s his life.
"After having a discussion with him, with his father, the agent and the club, we decided that the best thing to do was to leave and go on loan.
"Then we have to pick the right place, and having all the options, understand the experience that we had in Marseille as well with (William Saliba), the fact that Roberto (De Zerbi) is there and he’s an incredible developer of young talent and he’s a really courageous manager in the way he plays, the way he plays with young talent as well and he has a big track record about that.
"I think it fits the way of playing for the qualities that we want to see for Ethan. So it’s going to be a great experience for him."