Project Topic

THE IMPACT OF AGRICULTURAL DEVELOPMENT ON NIGERIA ECONOMIC GROWTH (1980-2010)

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 Format: MS word ::   Chapters: 1-5 ::   Pages: 65 ::   Attributes: Questionnaire, Data Analysis,Abstract  ::   942 people found this useful

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CHAPTER ONE

 

INTRODUCTION

 

  1. Background of the Study

 

Agriculture  is  the  foundation  and  bedrock  upon

 

which the development of stable human community has depended on throughout the whole universe such as rural and urban communities. It is concerned with the husbandry of crops and animals for food and other purpose. The study of the history of economics provides us with ample evidence that can agricultural revolution is a fundamental pre-condition for economic development. The agricultural sector has the potentials to be the industrial and economic springboard from which a country’s development can take off. Indeed, more often than not, agricultural activities are usually concentrated in the less developed rural areas where there is a need for rural transformation, redistribution, poverty alleviation and socio-economic development

 

The agricultural sector has the potentials to shape the landscape, provide environmental benefits such as conservation, guarantee sustainable management of renewable natural resources, preserve biodiversity and contribute to the viability of rural areas development. Through its spheres of activities at both the macro and micro levels, the agricultural sector is strategically positioned to have a high multiplies and linkage effect on any nation’s quest for socio-economic and industrial development. The growth of the agricultural sector in Nigeria was not smooth. Anyanwu (1967) held that during the colonial period between 1861 to 1960, attention was given to agricultural research and extension services. Among the activities that were done was the establishment of a research station in Lagos by Sir Claude Mc.Donald in 1893: Landmark of 10.4 km was acquired by the British Cotton Growing Association (BCGA) in 1899 for experimental purpose strictly for cotton and was named

 

“Moor Plantation” in Ibadan. In 1912, the Department of

Agriculture was established in each of the then southern and Northern Nigeria, but the activities of the department were virtually suspended between 1912 and 1921 as a result of the First World War and its aftermath. The period between 1929 and 1945 was a difficult one for the agricultural sector of Nigeria. This was the period of great depression when the world princes on commodities fluctuated. This affected the agricultural sector negatively because the volume of agricultural product increased but the value did not increase proportionally.

 

The period 1945 to 1945 marked the period of expert boom, because counties were just recovering from the Second World War and these countries needed to develop. They depended on primary production for the beginning stage of industrialization. They needed to revitalize their industrial sector by demanding primary goods. Prices of primary products rose higher again because there were speculations that there would be a third world war due to the outbreak of the Korean War. However, after this period, there came another period of price instability. This made the reliance on agriculture and its products to fall, leading to the establishment of a market board. This board bought these products from the local farmers and sold them overseas.

 

In spite of all the period, Nigeria made great revenue from agriculture. In the pre-independence era, the agricultural sector contributed most to the GDP of Nigeria. Helleiner (1966) said that in 1929, export production amounted to 57% of Nigeria’s revenue of which agriculture contributed about 80% of the export. On attainment of political independence in 1960, the trend was still very much the same, the Nigeria economy could reasonably be described as an agricultural economy, because agriculture served as the engine of growth of the overall economy (Ogen 2003). According to Alkali (1997) Nigeria was the world’s second largest producer of cocoa, largest exporter of palm oil during the period. And was also a leading exporter of other major commodities such as cotton,

groundnut, rubber and hides and skins. Between 1964 and 1965, agricultural output accounted for 55% of GDP and employed 70% of the adult workforce (Matton, 1981). In 1970, agricultural export crops like cocoa, groundnut, cotton, rubber, palm oil, palm kernel, etc. accounted for an average of between 65% and 75% of Nigerian foreign exchange earnings and provided the most important source of revenue for the federal as well as state government through expert products and sale taxes (Ekund are 1973). Despite the reliance of Nigerian peasant farmers on traditional tools and indigenous farming methods, these farmers produced 705 of Nigerian’s exports and 95% of its food needs (Lawal, 1997).

 

However, the 1967 to 1970 civil war in Nigeria coincided with the oil boom era, which resulted in extensive exploration and exportation of petroleum and its strong agriculture in favour of an unhealthy dependence on oil (United States Department of state, 2005). Ever since then, Nigeria has been witnessing extreme poverty

and insufficiency of basic food items. The agricultural sector contributions now accounts for less then 5% of

 

Nigeria’s GDP (Olagbaju and Fashola, 1996). It is against this backdrop that we set out to research on the impact of agricultural development on Nigeria economic growth.

 

As noted earlier, the neglect of the agricultural sector and the dependence of Nigeria on a mono-cultural crude oil based economy had not augured well for the well-being of the Nigerian economy. It becomes therefore imperative to study the impact of agricultural development on the Nigeria economic growth.

 

  1. Statement of Problem

 

The  agricultural sector has  suffered  from years of

 

poor management, inconsistent and poorly implemented government policies, government neglect and lack of basic infrastructure. Agriculture accounted for 30% of the GDP in 2010 (World Factbook, January 9, 2012).

 

Nigeria is no longer a major exporter of cocoa, groundnut, rubber and palm products. Coca production

mostly from obsolete varieties and over-aged trees are stagnant at around 150,000 tones annually. There is also a decline in groundnut, palm oil and other major export crops (United States Department of State, 2005). The decline in agricultural production was largely due to the rise of oil shipments (A.B Sekumade 2009).

 

Because of this backdrop, agriculture has not kept up with the rapid population growth and Nigeria once a large net exporter of for now imports most of its food requirements. Dependence on oil is not only the cause of the under-development of the Nigerian agricultural sector, but also:

 

  1. The Nigerian agriculture is characterized and surrounded by bunch of illiterate farmers who live in rural areas, producing over 90% of the total food consumed and other agricultural products and with regards to their educational status giving little or no room for improvement through scientific research.

And also more than 90% of the consumed food in

 

Nigeria is provided by the small-scale farmers.

 

  1. The Nigerian agriculture lacks storage facilities and these have led to so much wastage and high cost of storage. This hinders the availability of source perishable agricultural produce through the year, therefore hindering agricultural development.

 

  1. Another negative force is Dependence on weather which affects the increase in agricultural produce. Nigeria Agriculturists or farmers still depend on rainfall only to produce instead of the use of irrigation that supplies water all through the year.

 

  1. The problem of finance: The agricultural sector is poorly financed in Nigeria. They do not get credit easily from financial institutions, like commercial banks. The agriculturists find it difficult to finance projects which are capital intensive. The commercial banks cannot grant loans easily to a small scal

 

farmer because of low produce and low profit which

 

results to a failure in paying back the loan.

 

  1. In addition, the dependence on imported foods has disincentive investment in local farming.

 

Also, soil infertility is one of the problems of agriculture in Nigerian. Most of the farmable land in

 

Nigeria contains soil that is how to medium in productivity. According to the food and Agricultural Organization of the United Nations (FAO), with proper management, the soil can achieve medium to good productivity. The movies problem that affects soil fertility is soil erosion. Wind erosion, strong winds expose seeding lings and crops root system by blowing away loose, fine grain soil particles in drifts, which can cover crops.

 

Another type of erosion that affect soil fertility is water erosion. There are two types of water erosion: Splash erosion and rill erosion. Splash erosion occurs when rain drops impact the soil and rill erosion occurs

when channels of water carry soil downstream. This (water

 

erosion) is reduced when the soil is covered with a canopy.

 

  1. Food processing problem is estimated that about 20 to 40% of the yearly harvest is lost during processing.

 

The primary cause is the lack of efficient harvesting techniques.

 

According to and with the information above, it is quite clear that the agricultural sector, as one of the Nigeria economy has really got a lot to contribute to the economic growth of the country.

 

This research work therefore is aimed at answering the following questions:

 

  1. What is the effect of agricultural output on economic growth?

 

  1. What is the effect of agricultural sector on employment creation?

 

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