AGRICULTURE IS FUNDAMENTAL TO NIGERIA’S EMERGENCE AS A GLOBAL ECONOMIC POWER
JCC 2 is supporting the notion that Agriculture is fundamental to Nigeria’s emergence as a global economic power.
Today, fifty-seven years of post-independence, Nigeria should compete favourably with global economies rather than just African economies. This motivated the vision 20-20-20 program which aims to make our country one of the twenty largest global economies by the year 2020 and agriculture is fundamental in making this a reality.
Economic history is replete with ample evidence that agricultural revolution is a pre-requisite for economic growth, especially in developing countries (Byerlee et al., 2005; Woolf and Jones, 1969).
The importance of agriculture development in ensuring poverty reduction and the economic growth hinges on the fact that 70% of the population is employed in the agriculture sector. The sector’s role of food production, provision of resources for other sectors, creation of viable market and domestic savings gives credence to its importance in economic growth (CIA, 2013).
In 1960, petroleum contributed 0.6% to GDP while agriculture’s contribution stood at 67% (Yakub, 2008). In the 1960s, Nigeria was the world’s largest exporter of groundnut, the second largest exporter of cocoa and palm produce and an important exporter of rubber and cotton (Sekunmade, 2009). Last year, non-oil sector was the major driver of the economy, contributing 91.6% to Nigeria's GDP. Agriculture was the best performing sector, followed by Information and Communication, and Education emerged sectors with respective y/y (year-on-year) growth of 4.1 percent, 3.9 percent and 1.4 percent.
A majority of agricultural land in Nigeria remains uncultivated. About 34 million hectares of the land area is under cultivation and the diverse climate makes production of a variety of products, from tropical and semitropical areas of the world possible (Chauvin et al., 2012).
ChallengesDependence on oil
Originally an agriculture dependent country, Nigeria shifted focus to oil exports in the 1970s. By 1974, shares of petroleum had increased to 45.5% almost doubling that of agriculture which had decreased to 23.4% (Yakub, 2008). Quest for cleaner energy to curtail climate change has led to drop in demand and price of oil making it insufficient in sustaining the economy and stimulating needed economic growth hence the need to refocus on agriculture. Untapped potentials
The sector has several untapped potentials for growth and development in the availability of
land, water, labour and its large internal markets (Lipton, 2012). It is estimated that about 84 million hectares of Nigeria’s total land area has potential for agriculture; however, only about 40% of this is under cultivation (CIA, 2013).
Productivity in the cultivated lands is low due to small farm holdings and primitive farming methods. Nigeria has therefore become heavily dependent on food imports. In 2012 alone, importation of wheat was valued at $1billion (Nzeka, 2013). This does not promote savings and not economically friendly.
There are five inter-sectoral linkages through which agriculture contributes to economic growth: provision of food, labour, market, domestic saving and foreign exchange. These linkages can serve as reference points through which the government can target development policies and disburse investment funds tactically ensuring agriculture development which is a prerequisite for industrialization.
An offshoot of income growth is increased domestic savings, both at micro and macro levels as observed in developed economies like Japan, Taiwan, South Korea, Hong Kong and recently, China (Harbaugh, 2004). Agriculture therefore contributes to economic growth by increasing the incomes of majority of the population thereby strengthening their saving capacity (Engida et al., 2011).
Processing raw materials into finished goods to improve its price in the international market. For example, the 72 tonnes of yam exported by Pa Audu to the US and UK could have been processed to pharmaceutical grade starch (PGS) which is a major component of tablets and capsules and would weigh 9.7 tonnes of pure PGS which will yield more than five times the revenue gotten from the yam. Same goes for cassava, instead of just consuming it, we could convert it to PGS and make good money. Building and reviving facilities for processing raw materials gotten from farm produce and livestock rearing would boost local production, export, minimize imports and spending, create jobs, reduce poverty and starvation.
Imagine what would happen to our economy if Nigeria repeats the agricultural feats in the 1960s but this time leverage on the availability of land, water, labour, large internal and external markets, mechanized farming, training of farmers, making viable farm inputs easily accessible and building processing plants. It is incontrovertible that Agriculture is fundamental in helping Nigeria emerge one of the best global economies.
Byerlee, D., Diao, X., & Jackson, C. (2005). Agriculture, Rural Development and Pro-poor growth: Country experiences in the post-reform era. Agriculture and Rural Development Discussion Paper 21. The World Bank.
Chauvin, N., Mulangu, F., & Porto, G. (2012). Food Production and Consumption Trends in Sub-Saharan Africa: Prospects for the Transformation of the Agricultural Sector. UNDP Working Paper for African Human Development Report, pp. 1-74
CIA. (2013). The World Fact Book. Retrieved March 3, 2013, from https://www.cia.gov/library/publication ... os/ni.html
Eicher, C. & Witt, L. (1964). Agriculture in Economic Development New York: McGraw Hill, London
Engida, E., Tamru, S., Tsehaye, Debowicz, D., Dorosh, P. & Robinson, S. (2011). Ethiopia’s Growth and Transformation Plan: A Computable General Equilibrium Analysis of Alternative Financing Options. International Food Policy Research Institute (IFPRI), Development Strategy and Governance Division, Ethiopia Strategy Support Program II (ESSP II). Washington DC: IFPRI
Harbaugh (2004). China’s High Savings Rates. Prepared for conference on “The Rise of China Revisited: Perception and Reality”, National Chengchi University, published in Chinese in conference volume.
Lipton, M. (2012). Learning from others: Increasing Agricultural Productivity for Human Development in Sub-Saharan. United Nations Development Programme, Regional Bureau for Africa.http://web.undp.org/africa/knowledge/WP ... tivity.pdf
Nzeka, U. (2013). Grain and Feed Annual; Annual Report 2013. USDA Foreign Agricultural Service. http://gain.fas.usda.gov/Recent%20GAIN% ... 3-2013.pdf
Sekunmade, A. (2009). The effects of petroleum dependency on agricultural trade in Nigeria: An error correlation modeling (ECM) approach. Scientific Research and Essay, 4 (11), pp. 1385-1391
Woolf, S.S. & Jones, E.I. (1969). Agrarian change and economic development: the historical problem London: Methuen.
Yakub, M. (2008). The Impact of Oil on Nigeria's Economy: The Boom and Bust Cycles. Central Bank of Nigeria Bullion, 32 (2), pp. 41-50https://www.focus-economics.com/country ... igeria/gdpEssay composed by MagReuby, Supporting Debater.