Sector Development In Nigeria Research Articles

Migrant Remittances and Financial Sector Development: New Evidence from Nigeria

This paper analyzes the impact of remittances on financial sector development in Nigeria using data for more than four decades (1980‐2022). The study applies the error correction mechanism because of its ease of implementation, power and robustness as well as its role in explaining stationarity among economic variables. The empirical analysis shows that remittances promote financial sector development during the period with evidence that policies and programmes to improve the financial sector in the previous period impact significantly on the financial sector. The result also shows that increases in export and gross national product per capita promotes financial sector development in a positive and significant manner while high inflationary trend is detrimental to financial sector development.

Agriculture Sector Development in Nigeria: Empirical Investigation of Rail Infrastructure Quality Effect

For decades, Nigeria’s agriculture intermodal mix has been out of balance, leaning heavily on road transport. Seventy per cent of agro-produce transportation is through a crumbling road system. For stakeholders, the return of rail transport services is a good omen. The purpose of this paper was to investigate the effect of rail infrastructure quality on agriculture sector development in Nigeria spanning from 2000 to 2022, using time series data. The autoregressive distributed lag (ARDL) method estimates disclosed that railroad infrastructure quality had an inverse relationship with agriculture value added in Nigeria during the period covered in this study. Nevertheless, the federal government of Nigeria should make more effort to rehabilitate old rail lines and the construction of new ones to complement other modes of transportation across the country. In that regard, effort should be made to attract potential foreign investors in the construction of rail lines. At the same time, engineers should be properly trained in diesel locomotive technology and rail track management.

Transport Infrastructure, Institutional Quality and Agricultural Sector Performance in Nigeria

This research paper investigated the interaction among transport infrastructure, institutional quality and agricultural sector performance in Nigeria using annual data from 2000 to 2022. The ADF unit root test, Auto-regressive Distributed Lag (ARDL) bounds test, and Dynamic Ordinary Least Squares (DOLS) technique were deployed in the analysis of data. The empirical findings revealed that road infrastructure quality (LNROADQ) significantly influenced agriculture sector development. However, port infrastructure quality (LNPORTQ) was shown to negatively impact agriculture sector performance. Furthermore, the result revealed that institutional quality (LNREQ) significantly contributed to agriculture sector development in Nigeria. Therefore, the government should invest heavily in road transport, giving priority to roads that are mostly used for economic purposes such as agriculture, oil transportation and other economic-driven activities. Also, institutional quality should be improved.

Effect of Deposit Money Bank Activities on Financial Sector Development in Nigeria

The specter of non-performing loans (NPLs) looms as a critical concern within the context of Deposit Money Bank (DMB) activities in Nigeria. This apprehension is particularly pronounced when DMBs partake in risky lending practices, resulting in a substantial build-up of non-performing loans. The ramifications of such a scenario extend beyond the individual banks, impacting their financial health and, consequently, casting shadows on the overall stability of the financial sector. Given this foregoing, this study examines the effect of deposit money bank activities on financial sector development in Nigeria using time series data spanned over a period of eleven (11) years 2012 to 2022. The study adopted the ex-post-facto research design and secondary data used in the study was sourced from CBN annual statistical bulletin for relevant years. Descriptive statistics, Augmented Dickey Fuller Test (ADF), error correlation model, ordinary least square (OLS) regression techniques and post estimation test were the main statistical tools used to analysis the data with the help of E-view 10 statistical package. The finding of this study revealed that loans and advances and deposit liability exerts a positive and significant effect on financial sector development while interbank placements have negative and insignificant effect on financial sector development in Nigeria. The study recommended that deposit money banks should advocate for and enforce responsible lending practices among financial institutions, this involves ensuring that loans are extended based on sound risk assessment, with proper consideration given to the borrower’s creditworthiness and ability to repay.

Revisiting the nexus between remittances and financial sector development in Nigeria

Purpose ― The study aims to investigate the impact of remittances on financial sector development in Nigeria using data from 1990 to 2021.Method ― The study examines the variables' relationship using the Autoregressive Distributed Lag (ARDL) and Toda Yamamoto (TY) Causality.Findings ― The study finds that remittances have a positive and significant long-run impact on financial sector development. Total reserves and imports of goods and services have a negative and significant long-run impact. In the short run, remittances and deposit interest rates positively and significantly impact financial sector development, while total reserves and total population have negative and significant impacts. The Toda-Yamamoto causality result indicates a two-way causal relationship between financial sector development and remittances.Implication ― The study recommends that the government employs policies encouraging channeling remittances through a formal banking system, as well as ensuring that such remittances received are channeled to finance productive investment, hence financial development.Originality ― The novelty of this research relates to the use of the three main indicators of remittances in an economy, which are the import of goods and services, total reserves, and deposit interest rates, to examine its impact on financial sector development in Nigeria

International Monetary Fund Stabilization Programme and External Sector Development in Nigeria

The impact off the International Monetary Fund (IMF) stabilization programme has been a subject of great controversies. This study therefore investigated the impact of policy recommendations contained in the IMF stabilization Programme on the development of Nigeria’s external sector. In specific terms, the study examined the impact of fiscal deficit, exchange rate, foreign direct investment (FDI), degree of trade openness, interest rate and bank credit to the domestic economy on two indicators of external sector development namely; balance of payments (BOPs) and external reserves. A variety of analystical techniques including Phillips-Perron unit root test, autoregressive distributed lag (ARDL) model, error correction model (ECM) and Granger causality test was applied on annual time-series data from 1986 to 2021. The findings indicated that fiscal deficit has significant negative impact on balance of payments while exchange rate and interest rate have insignificant negative impact on BOPs. Also, degree of trade openness has significant positive impact on BOPs while FDI and bank credit to the domestic economy have insignificant positive impact on BOPs performance. Similarly, fiscal deficit, exchange rate and interest rate have insignificant negative impact on external reserves while foreign direct investment, degree of trade openness and bank credit to the domestic economy have insignificant positive impact on external reserves. In line with the IMF recommendations, the study recommended that the Nigerian government should reduce the size of its fiscal deficit; encourage the inflow of FDI and open up the economy to international trade. However, against the IMF recommendations, the study recommended that a managed free floating exchange rate policy should be adopted while the interest rate should be lowered. It is also recommended that bank credit to the private sector should be expanded.

Agricultural financing and economic performance in the Obudu local government area of cross River State, Nigeria

One of the challenges facing agricultural sector development in Nigeria is inadequate financing by the government and financial institutions. This poor agricultural funding has an impact on economic activities. Thus, this study investigated the connection between agricultural funding and economic performance in Cross Rivers State's Obudu Local Government Area (LGA). The survey study methodology was employed, and a questionnaire was used as its primary data source, combined with a stratified sample technique. The targeted population was restricted to farmers and agriculturalists in the study area. Descriptive statistics, such as frequency and percentages tables, were calculated, and the data gathered from the questionnaire were compiled, computed, and analysed. The results of hypothesis testing showed a relationship between agricultural finance and economic performance, as well as a connection between agricultural credit schemes and agricultural sector expansion, using analysis of variance (ANOVA) as the statistical technique. They also showed that credit programmes for agricultural finance encourage the expansion of the agricultural sector, which improves economic performance, as manifested in economic growth and development. The study recommends, firstly, that the government release grants to farmers at regular intervals to support their activities. Secondly, it is necessary to raise the level and size of agricultural loans through the reduction of interest rates to allow for more economic development in the country. The government should implement an effective and efficient supervisory framework to monitor interest rate regulation within the agricultural loan policy.

Insecurity and private sector development in Nigeria: an exploratory study

Insecurity and private sector development in Nigeria: an exploratory study

Economic Planning and Real Sector Development in Nigeria

One of the principal objectives of planning in underdeveloped or less developed countries is to increase the rate of economic development. This can be achieving through importing capital from abroad and localized force saving to support the level of industrialization in the real sectors of the economy. The central focus of this research is to examine economic planning and real sector in Nigeria by looking at the causes, consequences, and the way forward. The paper used library science method and collected data purely from secondary materials. The paper found that amongst the challenges of the real sectors development is poor government policies and monoculture nature of the Nigerian economy. These consequently resulted into not achieving macroeconomic objectives such as increase in output growth in all the sectors as expected. The study therefore suggested articulated development plan, improved governance, and service delivery. Governments should create an enabling environment through her planning for private driven economy to thrive through realistic power and energy programmes and reforms, functional institutions. This will encourage local industries and foreign direct investments into the real sector of the economy thereby increasing the levels of economic development in the economy.

Determinants of Insurance Sector Development in Nigeria

Determinants of Insurance Sector Development in Nigeria

Economic Planning and Real Sector Development in Nigeria

Economic Planning and Real Sector Development in Nigeria

Evaluating the Gas Flaring Commercialisation Policy in Nigeria: An Agenda for Mitigating Gas Flaring

Nigeria is an oil and gas producing country but sadly its gas sector had suffered serious setback in terms of development and utilisation. Although, the crude oil sector is nearing maturity, the gas sector is still in its infancy due to some past regulatory mistakes. As a result of low gas utilization and past development policies, gas flaring became the bane of the petroleum industry in Nigeria for over five decades and this is with no end in sight. Amidst, the abundant natural gas reserves, the country was considered one of the worst gas flaring nations after Russia. Past policies and legal regimes to reduce gas flaring were rather episodic and unrealistic due to several reasons notably: policy instability, lack of cooperation by the International Oil Corporations (IOCs) and the lack of political will by the Federal Government. Gas flaring in Nigeria contributes to both economic waste as well as a huge environmental challenge in the oil and gas producing communities. It was against this background that the Federal Government recently announced measures for the utilisation of flared gas from the Niger Delta region. The objective is to make hitherto gas flared to be commercially utilised thereby reducing their environmental footprint. The significance of this paper is to examine the efficacy of these inchoate government policies and their fit for purpose. The paper found that any such measure must be backed up with enforcement mechanism with attractive terms for new entrants into the gas sector development in Nigeria. Keywords: Gas Sector, Gas Development, Utilisation, Flaring, and Nigeria. DOI: 10.7176/JLPG/96-15 Publication date: April 30 th 2020

EFFECT OF FINANCIAL DEVELOPMENT ON FINANCIAL INNOVATION IN NIGERIA

Financial sector is crucial for the development of a well-functioning market as it facilitate capitalinflows, mobilize savings for productive investment and facilitates the conduct and growth of aneconomy in the world. Despite the importance of financial sector development in Nigeria, financialinstitution operating in financial market were confronted with drastic changes where by old waysof doing business were no longer profitable and sustainable and unable to acquire fund with theirtraditional financial instruments. Against this background, the study investigated the effect offinancial sector development on financial innovation in Nigeria. The study employed secondarydata obtained from central bank of Nigeria statistical bulletin and World Bank database between2011 and 2017. The data obtained was subjected to system General Method of Analysis (GMM)estimator. The study concluded that upward trend of process innovation significantly influence thein depth of finance. The study recommends policy makers should design policies which willpromote and enhance the relationship between financial innovation and financial development inother to increase the supply and provision of financial service.

Financial Sector Development in Nigeria: Do Financial Reform, Output Size and Resource Dependence Matter?

The study examined the determinants of financial sector development in Nigeria in an error correction modelling framework, and with OLS for robustness checks, using data from 1980 to 2017. The results show that, banking sector reform, gross capital formation, government expenditure, interest rate spread, output size and trade openness were significant determinants of financial sector development in both the short- and long run. Proxy for economic misery was only significant in the ECM equation, while literacy and human development metric was significant in the long-run equation. Natural resource dependence, proxy by ratio of natural resource rent to GDP, was negatively related to financial sector development in Nigeria, though the coefficient was not significant at conventional levels. Economic misery, interest rate spread and inflation were observed to undermine financial development in Nigeria. The study recommends the continuation of the process of financial liberalization because of its immerse benefits of promoting competition amongst financial institutions with attendant positive effects of reducing interest rate gap. Domestic output, measured by the real GDP, should be enhanced with appropriate stabilising policy, whether fiscal or monetary policy. Additionally, efforts should be enhanced to limit the effects of macroeconomic instability on financial sector development. Lastly, the study recommends efficient management of natural resources to enjoy a non-declining contribution to the development of an inclusive financial system in Nigeria.

Federal Resource Allocation and Social Sector Development: Evidence from Nigeria

Nigeria has a revenue allocation scheme which ensures that national wealth is shared among the three tiers of government. This fiscal relationship is expected to ensure national development and improve the quality of life of the citizenry. Thus, federal resource allocation is, among other things, expected to be channelled towards the development of the critical sectors, particularly the social sector for the overall wellbeing and welfare of the citizenry. Using a blend of secondary and primary data, this paper assesses the link between federal resource allocation and its implications on social sector development in Nigeria. The paper found that the utilisation of federal allocation has not enhanced the development of the social sector in Nigeria and that there was low commitment to the development of the social sector at all levels, reflecting in poor budgetary allocation and weak policy framework. Specifically, we recommend an enhanced federal resource allocation to the social sector in line with international benchmarks, increased political commitment, consistent policy framework and effective anti-graft measures.

Institutional Quality and Financial Sector Development: Empirical Evidence from Nigeria

In view of the indispensable role of financial sector in both emerging and developing economies, there has been a notable spotlight on the financial sector development over the years in most African countries. Nonetheless, there are only a few studies on this topical issue, particularly for Nigeria. Hence, this study examines the long – run and short – run dynamic relationship between institutional quality and financial development in Nigeria over the period of 1984 – 2015 using Auto-Regressive Distributed Lag (ARDL) bounds test approach to cointegration. Using two different indicators (Private credit and M2) of financial development, the results consistently show that institutional factors do not have significant effect on financial development in the long – run as well as in the short – run. Furthermore, the empirical evidence indicates that regulatory quality and governance system (institutions) do not necessarily contribute to financial development in a feeble institutional environment, specifically in Nigeria. Thus, our findings suggest that whilst weak institutions could increase the risk of limiting the functioning of financial system, good governance and strong institutions are the essential ingredient of financial development in Nigeria. As a consequence, policies aimed at strengthening the quality of institutions and governance should form the major policy thrust of government (policy makers). These could help improving financial sector development in Nigeria.

Influence of road transport infrastructure on agricultural sector development in Nigeria

Abstract The study investigated the effects of road transport infrastructure on agricultural sector development in Nigeria from 1985 to 2014, using secondary annual time series data on agricultural development (proxy by gross domestic product in the Agric sector) road transport infrastructure (proxy by length of paved road per square kilometer of area) export and capital, all obtained from the Central Bank of Nigeria (CBN) [3], and National Bureau of Statistics (NBS) [16], statistical bulletins. The data were analyzed using Granger Causality test and Ordinary Least Square estimation techniques. The study concluded that a positive and statistically significant relationship exists between road transport infrastructures (LRT) also evidence was found of a unidirectional causality from agricultural sector development to transport infrastructure. The study, therefore, recommends that adequate and timely maintenance of existing roads should be carried out as well as enacting appropriate regulations that ensure proper implementation and completion of new road construction contracts in the country in order to boost agricultural sector development, reduce wastage of farm produce and increase the possibility of economic diversification.

Banking Sector Operations and Foreign Direct Investment in Nigeria: A Causality Analysis

This study examined the causality relationship between banking sector operations in Nigeria and foreign direct investment from 1997 to 2015. The causal relationship between Foreign Direct Investment (FDI) and banking sector development in Nigeria is not clear yet, while there abounds empirical and theoretical studies on the nexus between foreign direct investment and economy in general, considerable attempts has not been made on the causality relationship between and banking operations in Nigeria. Specifically, this study ascertained the causal relationship between banking sector deposits, loans and advances, foreign exchange transactions, domiciliary operations, international banking operations and foreign direct investment. To achieve these objectives, this study employed Ordinary Least Square (OLS) econometric technique, Auto Regressive Distributive Lag (ARDL) bound test and granger causality test among others. Secondary data were collected from Central Bank of Nigeria statistical bulletin of 2015. The result indicated significant causal bidirectional relationship between banking sector deposits, foreign exchange transactions and foreign direct investments; a significant unidirectional causal relationship between domiciliary operations and foreign direct investment, while no significant causal relationship existed between loans and advances, international banking operations and foreign direct investment. The study recommends that banking sector should adopt completely smart banking as this evidences low risk, reliability and stability of the banking sector which is essential for inflow of foreign direct investments. Central Bank of Nigeria should cautiously focus on tackling monetary policy variables such monetary policy rate, cash reserve ratio and loan portfolio which a capable of attracting investors from abroad.

HOUSEHOLD INWARD REMITTANCES AND BANKING SECTOR DEVELOPMENT: THE NIGERIAN EXPERIENCE (1977 – 2014)

There has been a massive inflow of diaspora remittances into the Nigerian economy in recent times. However, there are concerns over whether or not inward remittances have any significant effect on the banking sector development in Nigeria. This study sought to: (i) examine the trend of household inward remittances and banking sector development in Nigeria; (ii) analyse the effect of inward remittances on banking sector development in Nigeria. Annual time series data were sourced from World Development Indicators (WDI) (2015) edition of the world bank for the period 1977 – 2014. We employed both descriptive statistics in the form of graph and Generalised Method Moment instrumental variables (GMM-IV) estimator to examine the inward remittances - banking sector development nexus Nigeria. Results show that inward remittances have positive but statistically insignificant effect on banking sector development in Nigeria (β =0.0727; t =0.5165). It is therefore recommended amongst others , that Nigerian banks develop remittance-linked financial products for Nigerians in Diaspora and remittance recipient households instead of treating remittance as a one-off transaction without value addition.

Innovation policies and sector development in Nigeria's oil palm industry: lessons from Malaysia

Increasingly developing countries are beginning to employ a set of instruments to promote industrialisation that are collectively termed innovation policy. This paper presents the qualitative outcomes of the differential uses of innovation policies to foster firms' innovation and production performance in the oil palm industry in Nigeria and Malaysia. The primary and secondary data used were gathered over a period of two years. The outcomes are different because the efforts and commitments to the policies were different over time. We show that the challenges of industrialisation constitute an evolutionary challenge that requires continuous and explicit effort. Employing a wide variety of factors; Malaysia demonstrate that countries can exploit low-tech traditional agricultural technologies such as oil palm for wealth creation by using a combination of policy instruments and incentives mechanisms to drive the sector whilst the lack of targeted policies might have contributed to the sub-optimal performance of the sector in Nigeria.