Impact Assessment of Agricultural, Manufacturing and FDI Performance on Economic Growth in Nigeria

Abstract

This study examines the impact of agricultural contribution, manufacturing output, and foreign direct investment on Nigeria's economic growth from 1990 to 2022. Using the Autoregressive Distributed Lag (ARDL) bounds testing approach, we analyze the long-run and short-run relationships between the non-oil sectors and GDP per capita. The findings reveal significant positive relationships between agricultural value-added, manufacturing output, and foreign direct investment with economic growth. The ARDL model demonstrates strong explanatory power with an R-squared of 0.969, indicating that 96.9% of variations in GDP per capita are explained by the model. Agriculture remains a linchpin of Nigeria's economy, contributing nearly 25% to GDP and employing 70% of the country's workforce, while FDI flows to Nigeria surged to USD 1.87 billion in 2023. The study provides empirical evidence supporting the diversification of Nigeria's economy away from oil dependency toward sustainable growth through agriculture, manufacturing, and foreign investment attraction.