Effect Of Foreign Private Investment On Agricultural Production In Nigeria

ABSTRACT

This study focused on the effect of foreign private investment on the agricultural output of Nigeria, using secondary data from 1981 to 2012. Data were sourced from the publications of national and international statutory bodies such as the Central Bank of Nigeria, the Federal Office of Statistics, the Nigeria Stock Exchange, the International Monetary Fund, and the Food and Agricultural Organization. Descriptive statistics, correlation and regression analysis were performed on the data obtained to arrive at the objectives of the study. The results show that there has been a steady and continuous increase in Foreign Private Investment (FPI) in Nigeria over the period of under study, with an estimated trend equation of y = 51.82t (r2 = 76.92). Correlation between Foreign Private Investment(FPI) and Direct Investment in Agriculture (DIA) was positive (0.733) at a = 0.01.FPI, DIA, Exchange Rate (ER) and Real Interest Rate (RIR) had significant effects on agricultural Gross Domestic Product (GDPA). The study also found out that FF1 contributed significantly to Total Investment (TINV) in the country, with a regression coefficient of 0.047 at a = 0.1. It was recommended that government's current efforts at attracting foreign investment into the country be sustained. Also, among the recommendations is that lending institutions should review their lending rates downwards free up flow of financial resources into the agricultural sector