Agricultural Investment Risk Relationship to National Domestic Production

This empirical case study investigated the uncertainty of agricultural investment schemes in Nigeria and their relationship to national domestic production. Government administrations have invested a substantial amount of money into the agricultural sector, yet thus far, there have been very few visible results to show for it. The private sector does not seem to be interested in developing agriculture even with government incentives. The purpose of this study is to identify investment risk factors for national agriculture development as perceived by business stakeholders. Ordinary Least Square (OLS) was then used to examine the strength of the cause-effect relationship for the agricultural investment factors in terms of expected domestic production. The findings were that there was no significant relationship between commercial bank credit granting to businesses for agricultural development and therefore no impact on national domestic production. On the other hand, the regression analysis did support the hypotheses that there was a significant relationship between government funding towards the agricultural sector and national domestic production as well as a significant relationship between the public agriculture credit guarantee scheme and national domestic production, respectively. Based on this positive finding, the study closes with several unique recommendations for policy makers in order to stimulate the investment into the agricultural sector to increase national production.