- Saturday, 25 January 2014
Since independence in 1960, the fortunes of Nigeria's agriculture industry dwindled in value and volume terms despite the country's enormous agricultural resource endowment and agriculture manpower capacity. The agriculture sector accounted for 65-70% of total exports in 1960. This figure however fell to about 40% in the 1970s, and less than 2% in the late 1990s. Main cash crops exported from the country in the late 1990s were cocoa (which accounted for only 0.7% of total merchandise exports in 1995), rubber and oil palm.
Yet, the agriculture (including hunting, forestry and fishing) sector was responsible for 32% of the country's Gross Domestic Product (GDP) in 1998, indicating an strong climb in local consumption agro-allied industry producing for local markets, no doubt due to an increase in the country's population. By the late 1990s, an estimated 35.2% of the country's labour force was employed in the agriculture sector. Staple foods include rice, maize, taro, yams, cassava, sorghum and millet witnessed production increase and a rise in acreage under cultivation. Timber production, fishery, livestock (goats, sheep, cattle and poultry) also witnessed an upsurge in production for sales in the country's internal markets. The World Bank lists agricultural GDP increase in Nigeria at an annual rate of 2.9% in 1990-98.
Today, the agriculture sector of Nigeria's economy remains the largest contributor to the Nigerian economy, being responsible for over 38% of the non-oil foreign exchange earnings, and employing about 70% of the active labour force of the population.
Dependency on hydrocarbon extraction and exports and hard currency accrued from petroleum sales, no doubt contributed to the neglect of the agriculture sub sector of national economy. While the petroleum sector of national economy witnessed an ever greater flow of investment to sustain and increase production, the agricultural sector was largely neglected. With the decline in crude oil revenue evident by the early and mid 1980s, government (state and federal) recognized the need to diversify the nation's economy by taking steps to promote the development of the agricultural sector. Government efforts to boost agriculture production was however hampered by the country's relative central planning economic system, between the 1980s and 1990s. With renewed efforts to deregulate Nigeria's economic environment in the 2000s, positive results are evident in Nigeria's efforts to stimulate agriculture production and attract greater investment in the sector by private capital.
Writing on the growth potential of agriculture in Nigeria, Ehui, Simeon K. Tsigas and Marinos E, disclosed "that although a 1% percent technological progress in the oil sector gives the largest welfare benefits in dollar terms ($142.72 million), but (when abstract for size) several food and agricultural sectors have a value that is higher than that for the oil sector". According to them, some sub-sectors in the agricultural sectors (e.g. cattle, fruit and vegetables) outperform some of the oil and manufacturing sectors in terms to return to investment". Their conclusion also indicate that "technological improvements related to unskilled labor produced the highest returns in agriculture compared to any other sector", while "in manufacture, the highest returns are obtained from technological improvements related to capital".
Results from Ehui, Simeon K. Tsigas and Marinos E strongly indicate that the agriculture sub sector holds the key to Nigeria's economic survival in the medium and long term, given the volatility of the hydrocarbon extraction industry, its susceptibility to externalities beyond the control of Nigeria's local market forces, unlike agriculture production for the internal market, as well as exports. The robustness of the agriculture sector and its potentials may again be evaluated in terms of the reality that though it suffers neglect because of the dominance of oil in the economy, it still constitutes the mainstay of national economy, being responsible for a third of GDP and employs the vast majority of the country's labor population, irrespective of the fact that it is still dominated by subsistence farming. Despite the potentials of the agriculture sector of the economy, the Nigeria remains the highest importer of rice and wheat in Africa, even though using various farming methods, rice for instance, can be grown in about all the country's vegetational zone. Thus, it may be seen that local demand, as well as the productive capacity to attend to this, and promised return on investment, is assured the investor, not only in rice production, but in the production of various cereals, legumes, etc in short supply.