IMPACT OF EXCHANGE RATE ON THE PERFORMANCE OF MANUFACTURING SECTOR IN NIGERIA
Raji Oladeinde Akeem
1Department of Insurance,
The Federal Polytechnic Ilaro, Ogun State
Email: akeemraji02@yahoo.com
ABSTRACT
This study examined the impact of exchange rate on the performance of manufacturing sector in Nigeria within the period of 2000 to 2018. Secondary source and time series data were gathered from the CBN Statistical Bulletin of 2018. The use of Ordinary Least Square was most appropriate for the study in terms of goodness of fit and significance of regression coefficient. Multiple regression of an econometric model was formulated for this study to examine the relationship between the independent variables exchange rate, interest rate and inflation rate and the dependent variable manufacturing output. The result was facilitated using Econometric view version 9. The result of the analysis shows that interest rate and inflation rate are statistically insignificant to explain manufacturing output while exchange rate is statistically significance to determine manufacturing output in Nigeria. The f statistics result reveals a probability value of 0.024 which is less than 5% level of significance, it can be concluded that exchange rate has a significant impact on the performance of manufacturing sector in Nigeria. The study therefore recommends that government should encourage the locally made products in Nigeria by removing the export duties in order to increase exportation of Nigeria products and increase import duties rate to reduce the patronage of external made products.
Keywords: Exchange Rate, Interest Rate, Inflation Rate, Manufacturing Output.
Reference to this paper should be made as follows: Raji Oladeinde Akeem (2019), Impact of Exchange Rate on the Performance of Manufacturing Sector in Nigeria. J. of Social Sciences and Public Policy, Vol. 11, Number 3, Pp. 36-59