Effect of Banking Sector Reforms on the Growth of Manufacturing Sector in Developing Economies: A Study of Nigeria 1986-2018 (Published)
The study examined the effect of banking sector reforms on the growth of manufacturing sector in developing economies: a study of Nigeria. The specific objectives of this study is to investigate the relationship between aggregate credit to the manufacturing sectors (ACM), commercial banks’ reserve requirement (CBR), commercial banks’ investment (CBI), loan-to-deposits ratio (LDR), lending rate (LR), real effective exchange rate index (EXR) and manufacturing sector output growth (MGDP), anchored on financial liberalization theory and keynesian theory of finance and economic growth. The study used secondary data obtained from the publications of NBS and CBN and subjected them to Co-integrating and Serial Correlation CM Test to ascertain the long run and short run relationship between ACM, CBR, CBI, LDR, LR and MGDP at 5% level of significance. The findings shows that banking sector reforms did not have significant effect on growth of the manufacturing sectors for the period 1986 to 2018 in Nigeria. We recommend that a more structured reform programme with identifiable and specific objectives that prioritizes credit to the manufacturing sector should be promoted.