Effects of Exchange Rate on Agricultural Export in Nigeria
Journal Title: International Journal of Engineering and Science Invention - Year 2018, Vol 7, Issue 8
Abstract
In order to stabilize the naira exchange rate against foreign exchange rates, this research examined and evaluated in comparative terms, the effects of exchange rate on agricultural exports as well as the total agricultural export in the pre-SAP (1992-1985) and the SAP era (1986-2010) in Nigeria. Based on the data collected from the Central Bank of Nigeria, Statistical Bulletin, Food and Agricultural Organizations (FAO) statistical data base for United Nations and World Bank Development indicators. The unit root test and regression analysis were employed to evaluate the trend in Agricultural export, examine the effect of SAP in agricultural export and investigate the determinants of agricultural export in Nigeria. The overall results confirmed that the lagged values of exchange rate devaluation had a significant and positive relationship with agricultural export. The results also showed that exchange devaluation in the SAP and the pre SAP eras had no significant effect on agricultural exports except in the case of natural rubber export. This was attributed to the low level of agricultural output in Nigeria. The results also revealed that per capita agricultural gross domestic product in Naira had a significant negative relationship with total agricultural export commodities. This was attributed to the fact that the resources available were diversified into other sectors of the economy other than the agricultural sector. Based on the findings of this research work, the result shows that agricultural export in Nigeria does depend on the exchange rate and price of crude oil in the long run. While exchange rate devaluation should be encouraged, more resources should be channeled into the agriculture sector to boost productivity.
Authors and Affiliations
Akinniran T. N. , O. V. Olatunji
Keywords
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