Agriculture Credit and Agricultural Export Growth Rate in Nigeria

AbstractDespite agriculture’s strategic importance in promoting economic diversification, employment generation, and foreign exchange earnings, Nigeria’s agricultural export performance has remained below its potential as a result of persistent financing constraints and macroeconomic instability. Based on the background above, this study examined the impact of agriculture credit on agricultural export growth rate in Nigeria. The study investigates the short-run and long-run relationships between agriculture credit and agricultural export growth. Using annual time-series data spanning from 1986 to2024, the analysis employed the econometric technique of Auto Regressive Distributed Lag (ARDL) model to capture linkage between the dependent and independent variables. The ARDL long run result showed that, trade credit in terms of credit to private sector, loan and advances to agricultural sector and loan repayment has long run positive relationship with agricultural export growth in Nigeria. Also, the short run results show that, trade credit in terms of credit to private sector, loan and advances to agricultural sector and loan repayment all have positive and significant impact on agricultural export growth in Nigeria during the period of study. Based on the findings, it was concluded that, credit systems play a significant but uneven role in shaping agricultural export growth in Nigeria. Thus, it was recommended amongst others, that government and financial institutions should expand agricultural credit facilities in order to boost agricultural products for exports and hence the growth of the Nigerian economy.