The Impact of Export Promotion on Economic Growth in Nigeria
Chapter One
OBJECTIVES OF THE STUDY
Objectives of the study
- To find out the impact of exchange rate fluctuation on the economic growth of Nigeria.
- To examine the nature of the relationship between exchange rate fluctuations and economic growth in Nigeria.
- To offer some recommendations based on the findings of the study.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
THE ROLE OF EXPORT PROMOTION ON THE ECONOMIC DEVELOPMENT OF NIGERIA
Nigeria has never disguised its desire to promote exports. Indeed, this year marks the 39th anniversary of export promotion as a formal objective of successive Federal Governments in Nigeria. It is noteworthy that Nigerian Export Promotion Council (NEPC), as the “arrowhead” of Government’s drive in this area, was set up since 1976.
NEPC has sought to make the non-oil export a significant contributor to Nigeria’s GDP by facilitating exports to promote sustainable economic development. Given that its overall strategy is to diversify the productive base of the economy away from oil and to foster market -oriented, private sector-driven economy, this strategy now aligns with the overall economic agenda of today’s Federal Government to intensely grow revenue from non-oil sources within the economy. Tax, as a significant source, makes Federal Inland Revenue Service (FIRS) to be feeling the heat on this already.
From the rebased Gross Domestic Product (GDP) figures, the oil sector contributes only about 15.9% to the entire GDP, leaving the remaining 74.1% to be shared among the sectors (the non-oil sector); i.e. agriculture, services, manufacturing, telecoms, etc. This is a gradual reversal of the initial trend in the GDP proportions between the oil and nonoil sectors. If these percentages are real as presented, then it is obvious that the potential for enhanced nonoil tax revenue can be tapped more significantly.
To complement its export promotion drive, the Federal Government, has, over the years, set up various incentive schemes for companies whose business is export focused. The incentives range from tax exemption to duty drawbacks as well as other forms of grants. Some of the incentives were those set up in 1986, under the Export Incentives and Miscellaneous Provisions Act. These included:
- Export Development Fund
- Export Expansion Grant
- Export Adjustment Scheme Fund
Out of the above schemes, the only one in operation till 2013 is the Export Expansion Grant (EEG). It was re-designed in 2005 and now administered by the Nigerian Customs Service (NCS). EEG is a grant issued to non-oil exporters to reduce production, distribution and logistics (Production) costs which will enable them compete effectively in the international market since production expenses will naturally impact product price. It was expected that goods from other countries with cheaper production costs would ordinarily sell cheaper than those exported from Nigeria.
The grant ranges from 10 per cent to 30 per cent of the Freight On Board value of the products being exported with a confirmation that the export proceeds have been repatriated. The amount received by the exporter also depends on the categorization of the exporter among others.
CHAPTER THREE
RESEARCH METHODOLOGY
METHODOLOGY
CHI SQUARE
RESEARCH DESIGN
Research design is the plan structure and strategy of investigation developed so as to obtain answer to research questions and control variance (Kerlinger, 1973:45).
SOURCES OF DATA
The researcher used both primary and secondary methods of data collection.
Primary Data: This is data that is obtained first hand from the respondents. Primary data method is obtained through the administration of questionnaires and personal interviews.
Secondary Data: secondary source of data are opinions of exports in the experts views and are obtained from related literature from private, professional ad academic libraries.
POPULATION OF THE STUDY
Since the study used secondary sources of data to collect information from the Journals, annual reports, related textbooks and CBN statistical bulletin review of the economy for various years. The population was of the study was not necessary in this study.
CHAPTER FOUR
DATA PRESENTATION, DATA ANALYSIS AND INTERPRETATION
This chapter is devoted to the presentation, analysis and interpretation of the data gathered in the course of this study. The data are based on the number of copies of the questionnaire completed and returned by the respondents. The data are presented in tables and the analysis is done using the chi-square test.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
The research work aimed at finding:
- To find out the impact of exchange rate fluctuation on economic growth of Nigeria.
- To examine the nature of the relationship between exchange rate fluctuations and economic growth in Nigeria.
- To offer some recommendations based on the findings of the study.
FINDINGS
From the responses of the respondents we are able to find out that:
- Export promotion helps the government to modify and adopt a better foreign exchange transaction for the economy.
- promotion helps provide the general public with the awareness on the foreign transaction and its impact on the economy.
- Exchange rate fluctuation has significant impact on the Nigeria economy.
CONCLUSION
From the result of the analysis, we concluded that exchange rate fluctuations have significant impact on Nigeria Economy Since the p-value is less than 0.05 which is the level of significance. The oil export rate and the non oil export rate has significant effect on the gross domestic product growth rate. See table 11, 12 and 13.
RECOMMENDATION
From the analysis and the findings we recommend the following:
- The federal government of Nigeria should increase the rate of export of domestic product as it will increase the gross domestic product growth rate.
- The federal government of Nigeria should encourge the manaufacturing industry to increase the manufacturing of exportable goods.
- The federal government of Nigeria should take a look at what is needed by some of these African countries and take over the market.
REFERENCES
- Adama, C.S (1999), Causality Between Export and Economic Growth in Nigeria (1970-1995) MSc Thesis, Department of Economics, A.B.U Zaria, Nigeria, Unpublished.
- Adenikinju and Olofin (2000), Economic Policy and Manufacturing Sector Performance in Africa. The Nigeria Journal of Economic and Social Studies 42 (1) 1-22
- Adeoye B. W (2004), Industrial Development in Nigeria in the Context of Globalization, In: Challenges of Nigerian Industrialization: A pathway to Nigeria Becoming a Highly Industrialized Country in the 2015, Selected Papers for the 2004 NES Annual Conference.pg 275- 303.
- Adewuyi A.O (2003), Dynamics of Trade and Exchange Rate Policies, Macroeconomic Adjustment and Economic Performance: Nigeria’s Experience, NISER Monograph Series No. 11 NISER, Ibadan,Nigeria.
- Agiobenebo, T.J (1995), Trade Theory and Development: A new Theory in old Religion. In: External Trade and Economic Development in Nigeria, Selected papers for the 1995 NES Annual conference proceedings NES (ed.). Pp.59-72.
- Ajayi,S .I (2002) Institutions : The Missing Link in the Growth Process?; Presidential Address Delivered at 43rd Annual Conference of the Nigerian Economic Society, Held in Lagos, from 7-8 August 2002,
