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ARTICLE SUMMARY

Title: Agricultural Financing and Poverty Reduction in Nigeria: Policy Implications
Author(s): ODILI Okwuchukwu
Abstract: The study investigated the impact of agricultural financing on poverty reduction in Nigeria and provides insight on policies that will drive the agricultural sector towards increase in output and hence alleviate poverty. Annual time series data spanning from 1981 to 2018 were sourced from CBN Statistical Bulletin, Bank of Agriculture and NBS. Poverty headcount ratio was used as proxy for poverty reduction. Commercial banks' credit to the agricultural sector, government expenditures on agriculture, agricultural credit guarantee scheme funds and Bank of Agriculture loans represents agricultural financing. ADF unit root test, Johansen co-integration test alongside VECM, variance decomposition and impulse response analysis were carried out. The results revealed that various proxies of agricultural financing had significant impact on poverty reduction in the short-run but the effects were however, not significant in the long-run. Variance decomposition and impulse response analysis revealed weak response of poverty headcount ratio to agricultural financing in the long-run. The study recommends that, agricultural financing policies should ensure financial inclusion of smallholder farmers. Policy thrust that will reduce poverty should crowd-in private investments into the agricultural sector. Government policies should focus on financing small- scale infrastructure that will directly impact on rural dwellers, develop local markets and provide small-scale processing facilities, storage facilities, local feeder roads, small power generators, health centers and schools. Value chain financing should be promoted.
Keywords: Agricultural Financing, Agricultural output, Poverty Reduction, Value chain financing, Nigeria GEL C

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Dr. Dennis B. Ewubare

EDITORS

Dr. Richard N Amadi
Dr. Ayodele O. Momodu

ASSOCIATE EDITORS

Dr. David O. Edokpa
Dr. Modubochi Wosu
Mrs. Oghenetega E. Wadi
Mr. Ebenezer F. Umor
Mr. Enyindah O. Owabie
Mr. Peter P. Finebone

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Mrs. Theresa B. Chris-Biriowu

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Prof. Godwin B. Okon
Prof. Precious N. Ede
Dr. Joseph I. Onyema
Dr. Emmanuel O. Davies
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