Banking Sector Development and Agricultural Productivity in Central African Economic and Monetary Community (CEMAC)

Ngong, Chi Aloysius; Thaddeus, Kesuh Jude; Onwumere, Josaphat Uchechukwu Joe

doi:10.17265/2161-6264/2020.02.002

Cited by 5 publications

(4 citation statements)

References 36 publications

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“…The results of DCPSB agree with the findings of Agunuwa et al . (2015), Chi et al . (2020), Chisasa and Makina (2013) and Hassan (2017) but disagreed with the findings of Dhrifi (2014), Ikenna (2012) and Mubaraq (2021).…”

Section: Discussion Of Resultsmentioning

confidence: 99%

“…Chi et al . (2020) investigated the long-term causal relationship between banking sector development and agricultural productivity in the CEMAC nations from 1990 to 2018 using autoregressive distributed lag and vector error correction model techniques.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Others indicate that bank credit has negative impact on agricultural productivity (Dhrifi, 2014; Ikenna, 2012). Some studies indicate bidirectional causality between bank credit and agricultural productivity (Chi et al ., 2020; Tamga, 2017). Others show unidirectional causality between bank credit and agricultural productivity (Osuji and Chigbu, 2012).…”

Section: Literature Reviewmentioning

confidence: 99%

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Has bank credit really impacted agricultural productivity in the Central African Economic and Monetary Community?

Ngong

Onyejiaku

Fonchamnyo

et al. 2022

AJEB

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Purpose This paper investigates the impact of bank credit on agricultural productivity in the Central African Economic and Monetary Community (CEMAC) from 1990 to 2019. Studies’ results on the impact of bank credit on agricultural productivity are not conclusive. The studies demonstrate diverse outcomes which are debatable. The results are conflicting. Design/methodology/approach Agricultural value added (AGRVA) to the gross domestic product (GDP) proxies agricultural productivity while domestic credit to the private sector by banks (DCPSB), broad money supply, land, inflation (INF), physical capital (PHKAP) and labour supply are explanatory variables. The autoregressive distributed lag technique is utilized. Findings The co-integration test results show a long-run co-integration among the variables. The findings disclose that DCPSB, land and PHKAP impact positively on the AGRVA. Broad money supply, INF and labour impact negatively on the AGRVA to the GDP. Research limitations/implications The results suggest that the CEMAC governments should encourage effective ways to increase bank credit flow to private enterprises in the agricultural sector through efficient bank's intermediation. Practical implications The governments should create more agricultural banks and improve the operation of existing ones to ensure direct credit to agricultural activities. The Bank of Central African Economic and Monetary Community should apply aggressive policy which eliminates all the bottlenecks undermining credit flow to the private sector in mutualism with agricultural productivity. Social implications The commercial banks should give more credit to private sector to mutually benefit the agricultural sector and the banking sector. The governments of the CEMAC economies should expand funding into the capital market which considerably boosts agricultural productivity. Originality/value Studies’ results on the impact of bank credit on agricultural productivity are not conclusive. The studies demonstrate diverse outcomes which are debatable. The results are conflicting; some reveal positive impacts, some show negative impacts and others indicate U-shape behaviour. Hence, research is required to fill the lacuna.

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Section: Discussion Of Resultsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 1 more Smart Citation

Has bank credit really impacted agricultural productivity in the Central African Economic and Monetary Community?

Ngong

Onyejiaku

Fonchamnyo

et al. 2022

AJEB

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“…D ' autres indiquent que le développement financier a un impact négatif sur la productivité agricole (Ikenna, 2012 ;Onoja, 2017). Certains travaux indiquent une causalité bidirectionnelle entre développement financier et la productivité agricole (Chi et al, 2020 ;Tamga, 2017), alors que d ' autres révèlent une causalité unidirectionnelle (Osuji & Chigbu, 2012). Une relation en forme de U inversé entre ces deux variables a été établie dans quelques travaux (Ali et al, 2021 ;Zakaria et al, 2019).…”

Section: Introductionunclassified

Développement financier et productivité agricole en Afrique subsaharienne

Dial¹,

Diouf²

2022

RIELF

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Financial development and agricultural productivity in sub-Saharan Africa. This paper evaluates the causal relationships between financial development and agricultural productivity in sub-Saharan Africa and in economic integration zones from 1990 to 2020. The methodology used is based on the ARDL model with the PMG estimator and a panel causality test. The results reveal that financial development has a positive longterm effect but a negative short-term effect on agricultural productivity in both SSA and WAEMU. However, the zonal analysis shows that in the short run, financial development decreases agricultural productivity in SADC. They also show that there is a bidirectional causality between financial development and agricultural productivity in SSA. This situation calls for the construction of an efficient financial system that is adapted to the realities of the agricultural world.

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Empirical evidence of the financial development and economic growth nexus in sub-Saharan Africa (1995–2022): an index approach

Hyacinth

Ngong

Onwumere

2023

JEAS

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PurposeThis research empirically investigates the evidence of the financial development and economic growth nexus in sub-Saharan Africa from 1995 to 2022.Design/methodology/approachA series of preliminary tests are conducted before using the two-stage estimated generalized least squares and robust least squares methods for the analysis. Two indices are constructed to measure financial development: one for the banking sector indicators and another for the market-based indicators (Ustarz and Fanta, 2021).FindingsThe results indicate that the banking sector index significantly impacts the gross domestic product (GDP) per capita positively. The market sector index has a negatively significant effect on the GDP per capita. Government expenditure has a positive impact on the GDP per capita.Research limitations/implicationsPolicymakers in sub-Saharan Africa should improve and implement finance–growth inclusive strategies that promote financial reforms and development to efficiently impact all population sectors. Policymakers should take stringent measures to ensure that the banking sector's development is sustainable to lead economic growth. The governments should strategize and promote capital market development using favorable listing rules for companies in the stock markets. Global stock market integration should be encouraged to diversify risks, increase public awareness, raise investors' confidence level and reduce stock market impediments like high taxes and regulatory barriers.Originality/valuePrevious study findings on the financial development and economic growth nexus are inconclusive and debatable. This study employs the financial development index approach.

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Banking Sector Development and Agricultural Productivity in Central African Economic and Monetary Community (CEMAC)

Cited by 5 publications

References 36 publications

Has bank credit really impacted agricultural productivity in the Central African Economic and Monetary Community?

Has bank credit really impacted agricultural productivity in the Central African Economic and Monetary Community?

Développement financier et productivité agricole en Afrique subsaharienne

Empirical evidence of the financial development and economic growth nexus in sub-Saharan Africa (1995–2022): an index approach

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