BANK LOANS, TEXTILE SUB-SECTOR AND ECONOMY GROWTH IN NIGERIA

Abstract

This paper examines the impact of bank loans on the textile sub-sector in Nigeria and as well examines the empirical relationship between the textile sub-sector and economic growth in Nigeria. The papers use the first-order autoregressive process of the Maximum Likelihood method to empirically determine the objectives of the study. The result of the study show that, increase in textile production will increase the Nigerian economy growth rate by insignificant value in the short run. The study also revealed that, credit to the sector have a positive relationship with textile production to a large extend in the short run. To promote the development and resuscitation of the textiles sector the study recommends that, the interest rate on loan to the sector should be reduce, in other to make fund attractive to the potential textile firms. Also,Government and banking sector should create a policy to facilitate low cost long term loans to the textile industry to boost the sector output both in the short and long run and to thrive and increase a higher economic growth.