AGRICULTURAL CREDIT GUARANTEE SCHEME AND ECONOMIC GROWTH IN NIGERIA
Author: JONES EBIDOUWEI
The objective of this study is to find out the impact of Agricultural Credit Guarantee Scheme (ACGS) on economic growth in Nigeria for the period 1981 to 2014. The study used endogenous components of Agricultural Credit Guarantee Scheme (ACGS) loans to Individual Farmers (LIF), loans to Informal Group (LIG), loans to Co-operative (LCO), and loans to Company (LCY) as explanatory variables to capture Agricultural Credit Guarantee Scheme (ACGS). Gross Domestic Product (GDP) at constant prices was used to proxy economic growth. Data for the study were obtained from the Central Bank of Nigeria (CBN) statistical bulletin of various publications, and regression analysis was carried out using IBM SPSS statistics. The t-test coefficients which attests to the significance of each of the independent variables of the study reveals that three of the parameters of the explanatory variables; ACGS loans to Informal Groups (LIG), ACGS loans to Cooperatives (LCO) and ACGS loans to Companies (LCY) counter apriori expectation with negative signs respectively. This implies that they do not have significant impact on economic growth (GDP). On the other hand, the variable of ACGS loans to individual farmers (LIF) as revealed by the regression result proved to have significant impact on economic growth (GDP). This indication is as a result of the variable’s conformity to the aprori expectation with positive sign in the analysis. It was recommended that more loanable funds should be made available to individual farmers (for commercial purposes), as ACGS loans to individual farmers can be used to formulate policies that can impact significantly on economic growth (GDP) in Nigeria. Further recommendation made was that, all economic stakeholders, monetary and regulatory authorities; both at the public and private sector of the economy should combine efforts and formulate policies aimed at improving financial inter-mediation, in the area of providing adequate credit to farmers in Nigeria. This will eventually lead to the achievement of a favourable productive-based economy and viable growth of GDP in the country. The study has contributed to the body of knowledge by providing current information on agricultural financing vis-à-vis Agricultural Credit Guarantee Scheme (ACGS), with an extensive period of 1981 to 2014 (34 years). This study thus has implications for global economy particularly in the area of food production and living standard of nations.
Supervisor: DR. DABOR E.L.