Foreign Direct Investment Inflow and Agricultural Sector Productivity In Nigeria
Journal Title: IOSR Journal of Economics and Finance (IOSR-JEF) - Year 2018, Vol 9, Issue 4
Abstract
The agricultural sector plays an important role in the Nigerian economy through its contribution to economic growth and development. Over the years, the growth potentials of the sector have been retarded due to under financing of the sector which results from total neglect of the sector by government and financial institutions. This paper thus, explored the impact of foreign direct investment on agricultural productivity in Nigeria. The study employed Augmented Dickey – Fuller (ADF), Johansen test and Error Correction Mode to examine the effect of foreign direct investment and agricultural development. The unit root test results revealed that all the macroeconomic variables namely Agricultural Productivity, Foreign Direct Investment, Bank Credit to Agricultural Sector and Government Expenditure to Agricultural Sector were stationary at first difference. The results of the co-integration test indicated that there exist long run equilibrium relationships among the variables. The result of the error correction model indicated that both foreign direct investment and bank credit to agricultural sector had significant effect on agricultural productivity while it was established that there exist an insignificant relationship between government expenditure to agricultural sector and agricultural productivity. It was however concluded that, for the Nigerian economy to benefit from the huge potentials of agricultural sector, the sector must be willing to explore more benefits offered by foreign investors. It was however recommended that, adequate infrastructures should be put in place by the government through massive rural-urban in infrastructure investment scheme in order to attract the flow of foreign investment to the agricultural sector. Government should provide stable and conducive environment that is capable of supporting the growth potentials and flow of international investment into the agriculture sector. Finally, government should prioritize the development of the agricultural sector through increase in government budgetary allocation to the agriculture sector. Government should set up a board for the purpose of monitoring the funds allocated to the agricultural sector in order to prevent diversion of funds by government agencies and farmers.
Authors and Affiliations
Akinwale S. O. (Ph. D. ), Adekunle . , E Oludayo, Obagunwa T. Busayo
Keywords
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- EP ID EP414879
- DOI 10.9790/5933-0904021219.
- Views 205
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