THE IMPACT OF AGRICULURAL FOREIGN AID ON AGRICULTURE IN NIGERIA

Nahanga Verter

Abstract: There is a continued debate over the implication of foreign aid to the receiving countries. The pro- aid, argue that the assistance complement the limited domestic funds for growth and development in underdeveloped countries, while the anti- aid opine that such external resource flow impedes growth as the resources are mostly diverted to other things, notably individual personal use. Against this backdrop, this contribution assesses the effect of foreign aid on agriculture in Nigeria. Using OLS regression, Granger causality and VDA approaches, the OLS results signify that foreign assistance to agricultural related activities has a positive effect on crop performance in the country. Similarly, the Granger causality shows a unidirectional causality running from foreign aid to crop production in Nigeria. In the spirit of global partnership for development, donors should continue to provide aid to Nigeria to stimulate domestic producers to expand their farms for maximum production. The infl ows of foreign assistance in agriculture should be promoted by the world organizations and the donors. Finally, the Nigerian government and donors should ensure that foreign aid is effectively and effi ciently utilized for agricultural related activities to boost crop production in the country.

Keywords: agricultural ODA; aid; crop production; finance; loans

Date published: 2017-10-20