ECONOMICS
ACCOUNTANCY
BUSINESS
ADMINISTRATION
BANKING
& FINANCE
MARKETING
INDUSTRIAL
RELATIONS & PERSONNEL MANAGEMENT
BSc
PROJECTS
|
YOU
ARE EXPECTED TO USE THIS THESIS AS A GUIDE; HOWEVER,
IF YOU WISH TO USE IT WHOLLY, YOU WILL BE RESPONSIBLE
FOR ANY ADJUSTMENT YOUR SUPERVISOR MAY REQUIRE
IT
WILL BE SENT TO YOUR E-MAIL AFTER PAYMENT SAME DAY
PROJECT
TOPIC : THE ROLE OF NON-OIL EXPORT IN THE ECONOMIC GROWTH OF NIGERIA (1981
- 2010)
PROJECT PROPOSAL
BACKGROUND
OF THE STUDY
As one of the most efficient tools for growth
and development, export promotion policy has been taken
by many countries since 1970. The role of exports in
economic growth and the relationship between these two
have been the subject of a wide range of empirical and
theoretical studies in international trade and economic
development field. As stated by Abou-Stait (2005), the
argument concerning the role of exports as one of the
main deterministic factors of economic growth goes back
to the classical economic theories by Adam Smith and
David Ricardo.
Although most recent literatures claim that export growth
promotes overall economic growth and that there is strong
relationship between these two variables and that exports
expansion contributes to the rate of economic growth
(Homayounifar and Rastegari (2008), Usman and Salami
(2008)), this is not the case for Nigeria. Osuntogun
et al (1997) noted that one major characteristic of
Nigeria’s export trade is the continued reliance
on developed countries as markets. This market concentration
has been blamed, in part, for the countries misfortunes,
as recessions in developed countries are usually fully
transmitted to Nigeria. Osuntogun et al (1997) maintained
that the negative effects from such shocks can be minimized
by diversifying export markets, especially since the
level of economic activity is likely to vary across
regions. They argued that the export promotion policy
stance, which also emphasizes the diversification of
markets, appears not to be yielding desired results
because exports to Organization of Economic Cooperation
and Development (OECD) countries still dominate.
So, from the period the Structural Adjustment programme
was introduced in Nigeria, concerted efforts had been
made to diversify Nigerian export sector by promoting
non-oil exports. The importance of this sub-sector cannot
be over-emphasised. Nigeria’s non-oil exports
which can broadly be classified into three, namely:
agricultural produce, manufactured exports and solid
minerals has great potentials. It is only of recent
that the export potential of solid minerals was brought
to the fore. The interest to promote non-oil exports
was borne out of not just its huge potentials for foreign
exchange earning, but also for its employment generation
and poverty reduction capability through the extensive
backward linkages it offers as well as the desire to
diversify the country’s production base. According
to Iyoha and Oriakhi (2002), in spite of SAP, the well-publicized
attempts to diversify the economy have not been successful.
Although Harb
(2008) found that oil revenues have no long-run effect
on the macro performance of the economy and as such,
cannot be blamed for a bad performance of the economy,
Zafar (2004) argued that volatility has become a prominent
and endemic feature of the world economy, and pronounced
fluctuations in commodity prices, especially oil, have
had a negative effect on the macroeconomic performance
of many developing countries. He stressed that the management
of volatility is very difficult in oil-exporting countries
in the developing world because fiscal revenue and macroeconomic
performance are highly sensitive to fluctuations in
the international oil price.
The year 2009 was overcast by the global financial and
economic crisis, which was precipitated in August 2007
by the collapse of the sub-prime lending market in the
United States. The crisis led to the crash of most other
sectors and markets across Europe with consequent effect
on developing economies especially oil-export dependent
countries like Nigeria. The impact was aggravated by
the reduction in crude oil production, due to the persistent
restiveness in the Niger Delta region.
The spiral effect of the global economic crisis on Nigerian
economy continued in 2009 with the exorbitant lending
rate mounting pressure on the stock market as a result
of massive borrowed fund in the market. The rush by
stock investors to liquidate their investment to repay
their loans in order to avoid the excessive lending
rate caused the Nigerian stock market to crash. This
decline was also driven by concerns over unrealistically
high valuations in practically all sectors. Regulatory
intervention in the equities market only served to dent
investor confidence further, especially among institutional
investors, as the measures failed to address the fundamental
issues.
It is evident from the foregoing that the recent global
economic crisis has further revealed that Nigerian economy
is excessively exposed to external shocks. Although
various factors have been adduced to Nigeria’s
poor economic performance, the major problem has been
the economy’s continued excessive reliance on
the fortunes of the oil market and the failed attempts
to achieve any meaningful economic diversification,
reflecting the effect of the so-called “Dutch
disease”. The need to correct the existing structural
distortions and put the economy on the path of sustainable
growth is therefore compelling.
PROBLEM STATEMENT
A review of the Federal Government revenue
profile in the last half-decade showed that oil earnings
accounted for over 80.0 per cent of the foreign exchange
earnings, while the non-oil sector, despite its improved
performance, contributed less than 20.0 per cent (CBN,
2008b), thus revealing the extent of the vulnerability
of the economy to swings in the price of oil in the
international market. The renewed emphasis on the production
of alternatives to fossil-fuel energy, such as solar,
wind and bioenergy in the advanced economies, would
reduce oil demand and further weaken Nigerian earnings.
Thus, in the absence of concerted efforts to shore-up
and widen the revenue base, there will be reduction
in crude oil revenue and excess crude oil receipts savings
in the coming years.
The performance of the non-oil export sector in the
past three decades leaves little or nothing to be desired,
in spite of the efforts to promote non-oil exports in
Nigeria. The share of non-oil export in the country’s
total export earnings has remained very low and it was
1% in 2008 (CBN, 2008b). The policy concern over the
years has therefore been to expand non-oil export in
a bid to diversify the nation’s export base (Adedipe,
2004). The diversification of the Nigerian economy is
necessary for important reasons. First, the volatility
of the international oil market with the attendant volatility
of government revenue gives credence to any argument
for diversification of exports. Secondly, the fact that
crude oil is an exhaustible asset makes it unreliable
for sustainable development of the Nigerian economy
(Utomi, 2004).
The continued unimpressive performance of the non-oil
sector and the vulnerability of the external sector
thus dictate the urgent need for a reappraisal of the
thrust and contents of the development policies and
commitments to their implementation. Indeed, the need
for a change in the policy focus and a shift in the
industrialization strategy is imperative, if Nigerian
economy is to be returned to the path of sustainable
growth and external viability. This raises the question
of the role of the non-oil export has in the economic
growth of the country and what factors are responsible
for the performance/or otherwise of the non-oil sector.
This calls for new thoughts and initiatives, which is
the essence of this project.
RESEARCH
QUESTIONS
According to the objectives stated above, the research
questions that would be examined in the course of the
study are as follows:
1. What has been the structure of the non-oil export
of Nigeria and to what extent has it contributed to
her economic growth?
2. What has been the performance of past government
policies and programmes at revamping the non-oil export
of Nigeria?
3. What macroeconomic factors are responsible for the
performance/or otherwise of the non-oil export of Nigeria?
OBJECTIVES
OF THE STUDY
The broad objective of this study is to appraise
the viability of the Nigerian Non-oil sector in the
diversification of Nigeria’s export. The specific
objectives of the study are as follows:
(i) to analyse the contribution of non-oil export to
the economic growth of Nigeria;
(ii) to evaluate past efforts at revamping the non-oil
export of Nigeria;
(iii) to identify the macroeconomic factors that are
responsible for the performance/or otherwise of the
non-oil sector of Nigeria.
RESEARCH
METHODOLOGY
The analysis that will be made in this project
shall be based on time series data for the Nigerian
non-oil export and macroeconomic data such as the gross
domestic product etc. Due to the complex nature of the
model formulation, Two-Stage Least Square (TSLS) estimation
method would be employed in obtaining the numerical
estimates of the coefficients in the models using EViews
statistical software. The estimation technique shall
based on the co-integration theory that was developed
to overcome the problems of spurious correlation often
associated with non-stationary time series data.
Two multiple regression models shall be used in the
estimation. The first regression
model shall seek to investigate the contribution of
agricultural non-oil export, manufacturing non-oil export
and minerals non-oil export to the Gross Domestic Product
of Nigeria while the second model seeks to investigate
the contribution of agricultural non-oil export, manufacturing
non-oil export and solid minerals non-oil export to
the industrial production of Nigeria, which is a better
measure of economic growth than Gross Domestic Product
(GDP). The estimation period shall be restricted to
the period between 1981 and 2010.
Besides the regression analysis, charts and ratio analysis
shall also be used to examine the structure and composition
of Nigerian non-oil export during the post and pre-SAP
era. The data for this study would be obtained mainly
from secondary sources; particularly from Central Bank
of Nigeria (CBN) publications such as the CBN Statistical
Bulletin, CBN Annual Reports and Statements of Accounts,
CBN Economic and Financial Review Bullion and Bureau
of Statistics publications.
MODELS SPECIFICATION
The models that would be estimated in the course
of this study are stated below:
MODEL I
Yt = c + c1NOEagrt + c2NOEmant + c3NOEmint
+ c4Yt-1 + Ei
Where Yt - Gross Domestic Product for current year
NOEagrt - Agricultural component of Non Oil Export
NOEmant - Manufacturing component of Non Oil Export
NOEmint - Solid Minerals component of Non Oil Export
Yt-1 - Gross Domestic Product for previous year
c, c1, c2, c3, c4 - Constants
Ei - Error term
MODEL
II
Iindt = d + d1NOEagrt + d2NOEmant + d3NOEmint
+ d4Yt-1 + Ei
Where Iindt - Index of industrial production for current
year
NOEagrt - Agricultural component of Non Oil Export
NOEmant - Manufacturing component of Non Oil Export
NOEmint - Solid Minerals component of Non Oil Export
Yt-1 - Gross Domestic Product for previous year
d, d1, d2, d3, d4 - Constants
Ei - Error term
RESEARCH
HYPOTHESIS
Based on the models stated above, the hypothesis
to be tested in this research is stated below:
H0 - That Non-oil export has contributed significantly
to the Economic growth of Nigeria.
H1 - That Non-oil export has not contributed significantly
to the Economic growth of Nigeria.
SIGNIFICANCE
OF THE STUDY
The effects of the recent global economic crisis
on Nigeria have reaffirmed the urgent need for economic
diversification in the country. Although, no country
is immune to such global crisis, the over-reliance on
oil export revenue by Nigeria exposes her economy excessively
to external shocks. Therefore, there is the need to
conduct a research of this nature to examine how to
strengthen the non-oil sub-sector with linkages to the
rest of the economy as safety nets to reinvigorate earnings.
The major significance of this study are as follows:
1. It would provide an econometric assessment of the
contribution of non-oil export to the economic growth
of Nigeria;
2. It would provide detailed composition of the non-oil
export of Nigeria in recent times.
3. The study would also identify the factors that are
responsible for the poor performance of the non-oil
export of Nigeria over the years.
SCOPE
OF THE STUDY
This project focuses on the role of the non-oil
export in the diversification of Nigerian economy as
necessitated by the devastating effect of the recent
global economic crisis. Although, several attempts had
been made to diversify the Nigerian economy since the
introduction Structural Adjustment Programme (SAP) in
1986, no meaningful success has been achieved. Therefore,
this project would examine the trend and composition
of non-oil export of Nigeria during the post and pre-SAP
era as well as its export profile. Subsequently, the
causes and consequences of the neglect of the non-oil
export shall be identified. The study would also investigate
the contribution of the non-oil export to the economic
growth of Nigeria with data spanning from 1981 to 2010.
PLAN
OF THE STUDY
This project shall be divided into five chapters.
The first chapter provides the background of the subject
matter justifying the need for the study. Chapter two
shall present related literature concerning the role
of non-oil export in economic growth. The structure
of non-oil export of Nigeria during the pre and post
SAP era shall also be discussed. The research methodology
shall then be stated in chapter three while data presentation
and analysis shall be made in chapter four. Concluding
comments in chapter five shall reflect on the summary,
conclusion and recommendations based on the findings
of the study.
REFERENCES
Abou-Stait, F., (2005), “Are Exports
the Engine of Economic Growth? An Application of Cointegration
and Causality Analysis for Egypt, 1977-2003”,
African Development Bank, Economic Research Working
Paper No 76, July.
Adedipe, B. (2004),
“The Impact of Oil on Nigeria’s Economic
Policy Formulation” A paper presented at the conference
on Nigeria: Maximizing Pro-poor Growth: Regenerating
the Socio-economic Database, organized by Overseas Development
Institute in collaboration with the Nigerian Economic
Summit Group, 16th / 17th June.
Central Bank
of Nigeria (2008a), Statistical Bulletin, Golden Jubilee
Edition, December, 2008.
Central Bank
of Nigeria (2008b), Annual Report and Financial for
the Year Ended 31st December, 2008.
Harb, N. (2008),
“Oil Exports, Non Oil GDP and Investment in the
GCC Countries”, Munich Personal Repec Archive
(MPRA) Paper No. 15576. Online at http://mpra.ub.uni-muenchen.de/15576/.
Homayounifar,
M and Rastegari, F. (2008), “Analysis of Economic-Political
factors affecting Non-oil Export of Iran”, American-Eurasian
Journal of Agriculture and Environmental Science, 2(supplement
1): 16-173.
Iyoha, M. A.
and Oriakhi, D. (2002), “Explaining African Economic
Growth Performance: The Case of Nigeria.” A Revised
Interim Report on Nigerian Case Study prepared for the
African Economic Research Consortium Research, May.
Osuntogun, A.,
Edordu, C. C. and Oramah, B. O. (1997), “Potentials
for diversifying Nigeria’s non-oil exports to
non-traditional markets”. AERC Research Paper
68, November.
Usman O. A. and
Salami A. O. (2008), “The Contribution of Nigerian
Export-Import (NEXIM) bank towards Export (non-oil)
Growth in Nigeria (1990-2005)”, International
Business Management 2(3): 85-90.
Utomi Pat (2004),
“The Curse of Oil”. A Paper delivered for
Heinrich Böll Foundation Oil-Conference by Lagos
Business School, May.
Zafar, A. (2004).
“What happens when a country does not adjust to
terms of trade shocks? - the case of oil-rich gabon”,
World Bank Policy Research, Working Paper 3403, September.
PROJECT
PROPERTIES
Number
of Chapters |
5 |
Number
of Pages |
122 |
| Number
of Words |
16,525 |
Number
of References |
46 |
| Project
Level |
M.Sc./MBA |
| Price
|
N20,000
(Non-Negotiable) |
| Abstract,
Regression Data and Results are included |
B.Sc.
version of this project is available -
CLICK HERE |
|
Keywords: nigeria
economic growth, economic growth in nigeria, nigerian
economic growth, exporting to nigeria, economic growth
statistics, economic growth data, sources of economic
growth
|
