Agricultural Financing and Food Security in Nigeria: A Strategy for Achieving Sustainable Development Goals (SDGs)

Abstract

The study examined the contribution of agricultural financing to food security in Nigeria. The study scope was annual data from 1981 to 2022, sourced from the Central Bank of Nigeria Statistical Bulletin, 2022, and World Bank Data Indicators, 2022. Food security was measured using the food production index. At the same time, agricultural financing is proxied with government expenditure on agriculture, deposit money banks (DMB) credit to agriculture, and agricultural sector guarantee scheme fund loans to agricultural sector. The study also introduced interest rates and agrarian output into the model. It utilized the autoregressive distributed Lag
(ARDL) model as the main estimation technique and found that government expenditure on agriculture and agricultural sector guarantee credit scheme loans to the agricultural sector have a negative influence on food security in Nigeria, while deposit money banks (DMBs) credit to agriculture is found to influence food security in Nigeria detrimentally. The study recommended that government expenditure on agriculture should be channeled towards the rural region of the country, and credit for agricultural purposes should be given to the peasant farmers who engage in small-scale farming in Nigeria.