Conference Paper

MACROECONOMIC VARIABLES AND MANUFACTURING SECTOR IN NIGERIA

Abstract This study assessed the impact macroeconomic variables on the productivity of manufacturing output for the period of 34years (1990-2023). The variables such as, exchange rate, inflation rate lending rate and manufacturing output share of gross domestic product were employed for the study. To achieve this objective, time series and secondary source of data were employed. These data were gathered from Central Bank of Nigeria (CBN) statistical bulletin of 2023. The study employed descriptive statistics, correlation analysis, unit root test and ordinary least square method. The findings revealed that exchange rate has a significant impact on manufacturing output share of gross domestic product. It was also revealed that there is no significant relationship between inflation rate and manufacturing output share of gross domestic product. Similarly, lending rate does not have significant effect on manufacturing output share of gross domestic product in Nigeria. As stated by f-statistic result the study concluded that macroeconomic variables have significant impact on the productivity of manufacturing sector in Nigeria. It was therefore recommended among others that government should improve exchange rate management through policies that reduce volatility and enhance the predictability of the currency to benefit the manufacturing sector. Also, Central Bank should implement inflation control measures that focus on stabilizing the economy and reducing the cost-push pressures that affect manufacturers, especially in relation to raw material costs. Keyword: Gross Domestic Product, Exchange Rate, Inflation Rate, Lending Rate, Manufacturing Sector.