THE RELATIONSHIP BETWEEN NIGERIAN GROSS DOMESTIC PRODUCT AND FINANCIAL INVESTMENT IN THE TRANSPORT, UTILITY, CONSTRUCTION AND REAL SECTORS (1990-2009)

Abstract

Nigerian development depends much on the construction to improve its value. The aim of this research is to examine the relationship of building and construction sector on Gross Domestic Product and other related sector of the economy. The real sectors that generate the bulk of construction suffer government negligence due to lack of steady GDP in measuring the performance of these sectors. The objective of this research is to determine the relationship existing between building and construction sector against real sector and GDP against real sector. The research assumed that the sector studied have a substantial input on building and construction, and there was a continuity in government over the period of study, social, political, government policy and the stability throughout the period. Data was collected from Central Bank of Nigeria statistical bulletin 2009 of gross domestic product prices in millions of Naira (1990 -2009). The data obtained was analysed by Simple linear regression analysis and the trend over time. Conclusion were drawn, the first experiment between construction and six sectors of the economy tested positive with low R2 value ranging from 2% - 4%. Construction and other sectors of economy measured against GDP ranging from 9% to 95%. Finally the multiple regression ranges between 59-95%. Recommendation were made due to the low level of R2 values of construction against the real sectors and the GDP against construction and the trends over time is not static, it fluctuates with time. That provides cause for worry, efforts should be made to improve the low level of R2 value to a significant level by government prioritising the construction sector since the industry forms a foundation for development of any nation. Further studies could be carried out of periods between (1990 – 1999) ten years military regime and (2000 – 2009) ten years civilian regime in other to form a basis for comparison. Federal ministry of finance should consider the dollar value to form a basis for budget preparation and resources planning.