IMPACT OF MANUFACTURING SECTOR ON ECONOMIC GROWTH IN NIGERIA (1986 - 2023)

ABSTRACT This study assessed the impact of manufacturing sector on economic growth in Nigeria. The objectives of the study wereto determine the effect of textile, cement, food and beverage industries on economic growth and to find out the causal effect between textiles, cement, food and beverage industries and economic growth in Nigeria. The study utilized time series data from CBN Statistical Bulletin (2023), and covers the years 1986 - 2023, which is a period of thirty-seven (37) years. The variables of the study are Economic growth- proxied by the gross Domestic Product(GDP), output of Manufacturing sector, Exchange rate, textile, cement, and food and beverages.The theory that was used to explain the manufacturing sector is the dual Economy Theory.Econometric analysis was used to test the Stationarity of the variables using Augmented Dickey-Fuller test. The results shows that gross domestic product,Food and beverages and Textileare stationary at level. In contrast, Manufacture, exchange rate, andcement were found to be stationary at first difference. The empirical results of the Auto Regressive Distributed Lag model show thatthe lagged value of GDP significantly and positively influences economic growth.Likewise, second lag value of food and beverages, textile and its first lag also have a statistically significant relationship with GDP in Nigeria over the study period, while the other variables and their lags are statistically insignificant. The model used for the research work is free from serial correlation, heteroscedasticity, and functional form and normality problems. As such, the work produced reliable results.The study concluded and recommended that,the Nigerian government should Implement vocational training programs will equip the workforce with necessary skills relevant to modern manufacturing processes and should establish stable and predictable policies will encourage both domestic and foreign investments in the manufacturing sector.