The Impact of Diversifying Export Structure on the Reality of Human Development in Nigeria

Attempts by successive administrations in Nigeria to diversify the export base of the economy have largely been driven by the recognition of the importance of diversification in the attainment of the economic development. However, despite decades of experimenting with various policies, programs and approaches, revenue diversification of the economy has remained difficult. In this study, we examined the implications of this status quo on the economic development of the country. Specifically, the study sought to: examine the impact of export diversification on human development index in Nigeria. The scope of the study covered the period 1980 to 2019, while the analysis of data on the relevant variables was carried out through the use of the Auto-Regressive Distributed Lag (ARDL) model. The results derived from the study, which were evaluated on the basis of the 5 per cent level of significance, indicated that export diversification has a positive and statistically significant impact on human development index in Nigeria in the short-run. Other findings made by the study were that gross domestic investment has a positive and significant impact on human development index, government expenditure has a negative and significant impact on human development index, current value of foreign direct investment has a negative and insignificant impact on human development index, previous value of foreign direct investment has a negative and significant impact on human development index, current and previous values of inflation rate has a positive and insignificant impact on human development index, previous value of openness has a negative and insignificant impact on human development index while previous value of openness has a positive and significant impact on human development index. Based on the findings, the study recommended that: the government should carry out a review of its export diversification strategies and also horizontal and vertical export diversification strategies; the government should increase its efforts to promote the level of domestic investment by encouraging financial sector to give more loans to key sectors of the economy producing export commodities, among others.