Private Sector Credit and Agro-Processing Sector Growth in Uganda.
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Date
2025-03-23
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Makerere University Business School
Abstract
This structured abstract provides an overview of research on the connection between private-sector credit and agro-processing sector growth in Uganda. The study examined the relationship between commercial banks' credit and agro-processing sector growth, the relationship between microfinance credit and agro-processing sector growth, and the causal effect of commercial banks' credit and microfinance credit on agro-processing sector expansion. The study used a quantitative approach and employed various econometric techniques, including unit root tests, co-integration tests, vector error correction models (VECM), and Granger causality tests. The results showed a positive, significant long-run effect of both commercial banks' credit and microfinance credit on agro-processing sector growth. However, there was no significant short-run effect of credit on agro-processing sector growth. The research findings indicated that access to long-term credit and microfinance support can enhance the growth of the agro-processing sector in Uganda. The findings contribute to the understanding of the role of credit in promoting sectoral growth and provide policy recommendations for enhancing access to credit for agro-processing firms. Further research could explore the specific mechanisms through which credit affects agro-processing firms and investigate the role of other factors, such as technological innovation and market access.
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This is a master's thesis.
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Citation
Kabakama, J. (2025). Private Sector Credit and Agro-Processing Sector Growth in Uganda. (Unpublished master's dissertation). Makerere University Business School, Kampala, Uganda.