ROLE OF WOMEN ENTREPRENEUR IN BUSINESS DEVELOPMENT IN NIGERIA
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ROLE OF WOMEN ENTREPRENEUR IN BUSINESS DEVELOPMENT IN NIGERIA
Chapter one
1.1 Introduction
Background of the study
The real exchange rate and Nigerian agricultural exports—One of the most dramatic occurrences in Nigeria over the last decade has been the devaluation of the Nigerian naira following the implementation of a structural adjustment programme (SAP) in 1986. The SAP’s primary goal was to restructure the economy’s production base, with a positive slant towards agricultural export production.
Foreign exchange reforms that allowed for a cumulative depreciation of the effective exchange rate were expected to raise domestic agricultural export prices and thus significantly boost domestic production;
however, this depreciation resulted in changes in the structure and volume of Nigeria’s agricultural exports, as empirically determined by many researchers (Oyejide, 1986; Ihimodu, 1993; Osuntogun et al, 1993; World Bank 1994).
The depreciation raised the pricing of agricultural exports, and studies have demonstrated a significant increase in the amount of agricultural exports over time. However, the volatility, frequency, and unpredictability of exchange rate swings since the introduction of the floating exchange rate have raised concerns about their impact on agricultural treacle flows.
Structural adjustment and agricultural performance, among other measures, the structural adjustment plan (SAP), which began in 1986, disbanded the commodity board, the agency in charge of organising and purchasing agricultural exports since 1960.
As a result, farmers could sell their products directly to overseas buyers and local processors without the need for intermediaries. This was supposed to eliminate the disproportionate taxation on former products imposed by marketing boards and allow producer pricing to be established by market forces.
Given that agricultural output is influenced by a variety of factors, the naira’s depreciation and the dissolution of commodity boards were predicted to result in an overall increase in export production.
There was a significant growth in most key agricultural export crops, which had been declining since the 1970s. By 1985, just 375 of the 1970 output had been reached.
According to Kwanaslice et al. (1994), the degree of price variation is a significant predictor of changes in earnings given the trend in output over time.
In this context, however, an exchange rate might be described as the rate at which one currency can be exchanged for another, or as the price of one currency in relation to another.
Furthermore, the exchange rate is a key relative price in the economy, with a political undertone, so policies to change it are frequently at the centre of adjustment programmes designed to improve international competitiveness and self-directed resources towards the production of tradable goods.
The exchange rate, which is the price of one currency in relation to another, is extremely important in both the national and international economies. Moroso. An IMF (1984) study of cities argues that exchange rate unpredictability leads to undesired macroeconomic phenomena such as inflation and protectionism.
However, more recent research explains why a positive effect is also feasible (de Grauve, 1988; Caballero and Corbo, 1989). If enterprises hedge against exchange rate increases, one would not expect a significant negative impact on trade.
Hedging against risk can be done in the futures or forward markets. Forward markets change the nature of the uncertainty that traders encounter. A forward market is essentially a guaranteed estimate of when the contract period will end.
A trader can benefit from payment of a little margin around future rates.
Because currency uncertainty can be eliminated from short-term trading transactions by paying this margin, the cost of such uncertainty cannot be more than the cost of obtaining insurance against it.
Furthermore, successive Nigerian governments planned and implemented a wide range of currency rate policies that failed to fulfil their stated goals, either partially or completely.
The real sector is characterised as consisting of the following sectors: agriculture, manufacturing, building, construction, mining According to an analysis of financial statistics conducted by the World Bank and the Economist, the real sector of Nigeria’s economy has suffered the most.
The strict documentation requirements of the official market drive out some FX requests, which are eventually met in the parallel or black market.
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