NEXUS OF AGRICULTURAL CREDIT AND SUSTAINABLE FOOD PRODUCTION IN NIGERIA: APPLICATION OF A MODIFIED REGRESSION MODEL

Abstract

It is time for Nigeria to feed Nigerians with the aim of actualizing the United Nation’s Sustainable Development Goals in the area of zero hunger (food security). Recent statistics show increasing food insecurity issues; the global COVID 19 pandemic has further worsened the country’s food (in)security situation. This study econometrically assessed the nexus of agricultural credit and sustainable food production in Nigeria. Secondary data on variables of interest were gotten from World Development Indicators (WDI) of the World Bank and other relevant bodies. The data were analyzed using Unit Root Test (URT) and the Fully Modified Ordinary Least Square (FMOLS). The study revealed that Agricultural Credit Guarantee Scheme Fund (ACGSF) and loan to agriculture from the commercial banks statistically and positively influenced food security within the study period. Lending interest rate and official exchange rate inversely influenced food security. The study concluded that credit is key to achieving self-sufficiency in food production. The post estimation tests on the models confirmed that policy implications from this study are applicable to improving food security. Proper and efficient policy mix to support agricultural production including provision of credit was recommended.

Keywords

• agricultural credit
• food security
• sdg 2
• food production
• interest rate
• exchange rate