IMPACT OF EXCHANGE RATE POLICY ON NON-OIL EXPORTS IN THE NIGERIAN ECONOMY

ABSTRACT
The decline of non-oil exports has had adverse effect on the economy. Since 1986, the federal government has formulated policies to enhance non-oil exports, put in place incentives and institutional support framework effective implementation.

This paper examines these policies to investigate the extent to which the exchange rate can boost non-oil exports especially agricultural, manufactured and mining exports. This paper is derived from the recognition that the country’s current economic predicament is partly a product of her over reliance on the oil sector for foreign exchange earnings. Hence, if non-oil exports can be expanded, it would no doubt cushion the economy against the undesirable effects of instability in the world market. Nigeria should draw closer to other countries in the region with a view of encouraging intra-African trade. In addition, commodity agreement should be vigorously pursued and commodity exchange utilized to manage the price risks inherent in trading

Finally, improvement in non-oil production and export will occur only if there is consistency and continuity of policies as well as political stability.
It is on this note that this project was written.

                                                                                    
CHAPTER ONE: INTRODUCTION

    1. Background to study------------------------------------------------------1-                                                                                      
    2. Problem Statement --------------------------------------------------------6
    3. Scope of the Study--------------------------------------------------------8
    4. Objectives of the Study--------------------------------------------------8
    5. Justification of the Study------------------------------------------------9
    6.  Research Questions-----------------------------------------------------10
    7. Research  Hypothesis----------------------------------------------------10
    8. Research Methodology---------------------------------------------------11
    9. Sources of Data-------------------------------------------------------------11
    10. Outline of Chapters--------------------------------------------------------11                                                                                                                                                                                                                                                                                                                                                                                       

CHAPTER TWO: LITERATURE REVIEW

    1. Introduction-------------------------------------------------------------------13
    2.  Empirical issues-----------------------------------------------------------13
    3. Types of Exchange Rate------------------------------------------------16
    4. Exchange Rate Management in Nigeria---------------------------17 
    5.  Policy Changes Since 1994 and Non-oil exports--------------18
    6.  Other Factors Affecting Non-oil Exports--------------------------20
    7. Theoretical Issues----------------------------------------------------------23-23                                                                                                                                                                                                                                   

CHAPTER THREE: THEORETICAL FRAMEWORK AND MODEL SPECIFICATION

    1. Introduction-------------------------------------------------------------------25
    2. Theoretical Framework---------------------------------------------------25
    3. Research Methodology---------------------------------------------------29

3.3.1    Method Applied-----------------------------------------------------------------------29
3.3.2    Model Specification-----------------------------------------------------------------30
3.3.3    Theoretical Expectation------------------------------------------------------------32
CHAPTER FOUR:  EMPIRICAL ANALYSIS

    1. Introduction-------------------------------------------------------------------34
    2. Presentation of Regression Result-----------------------------------35    
    3. Data Analysis and Result-----------------------------------------------37-36                                                                                        

4.3.1    Analysis of Regression Result---------------------------------------------------36
4.3.2    Hypothesis Testing------------------------------------------------------------------37

    1. Analysis of the Structure of Non-oil Exports in Nigeria(1970-2004)--------------39                                              

                                                                  
CHAPTER FIVE: SUMMARY AND CONCLUSIONS

    1. Summary Of Findings-----------------------------------------------------46
    2. Conclusion and Recommendations-----------------------------------47
    3. Limitation to Study---------------------------------------------------------49
    4. Suggestion for Further Study------------------------------------------49

APPENDICES
1.  Bibliography
2.  Variables for Regression Analysis
3.   Correlation Matrices
4.   Regression Result
LIST OF TABLES
Title                                                                                                       Page
Table 4.1:Ordinary Least Square Estimation-------------------------------------------------35                                                           
Table 4.2:Structure of Nigeria’s Exports: 1970- 2004-------------------------------------- 40
Table 4.3:  Share of Nigeria’s Non-oil Exports in GDP-------------------------------------42