Agriculture
is the foundation and bedrock upon which the development of stable human
community has depended on throughout the whole universe. 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 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 ke 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 price depression when the world price 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 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, 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, 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 the researcher
set out to asses 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 yielded any positive change for
the well-being of the Nigerian economy. It becomes therefore imperative to
asses the impact of agricultural development on the Nigeria economic growth.
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 (Sekumade,
2009).
Because
of this backdrop, agriculture has not kept up with the rapid population growth
and Nigeria
once a large net exporter food 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 includes the following:
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.
2. Also more than 90% of the consumed food in Nigeria is
provided by the small-scale farmers.
3. The Nigerian agriculture lacks storage
facilities and these have led to so much wastage and high cost of storage, thus
hinder the availability of such perishable agricultural produce through year, round.
4. 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 scale
farmer because of low produce and low profit which results to a failure in
paying back the loan.
5. 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
farm land in Nigeria
contains soil that is how to medium in productivity. According to the food and
Agricultural Organization (FAO) of United
Nations with proper management, the soil can achieve medium to good
productivity.
This
research work therefore is aimed at answering the following questions:
(i) What is the effect of agricultural output on
economic growth?
(ii) What is the effect of agricultural sector on
employment creation?
The
broad objective of this study is to determine the impact of agricultural
development on economic growth in Nigeria.
1. To determine the
impact of agricultural sector on the economic growth in Nigeria.
2. To determine if
there exist a long —run relationship between the agricultural sector and
economic growth in Nigeria.
For
the purpose of this study, the following hypothesis is tested;
1. Ho;
Agricultural sector has no significant impact on economic growth in Nigeria.
Hi;
Agricultural sector has significant impact economic growth in Nigeria.
2. Ho: Agricultural sector has long-run
relationship with Nigeria
economic growth.
Hi: Agricultural sector has no
long-run relationship with Nigeria
economic growth.
The
significance of this study depends on the fact that with improved agricultural
sector Nigeria
stands to gain and improves the living standard of the masses.
This work stands to benefit:
1. Nigeria as a
whole: The research work intends to bring forth ways to increase agricultural
output both for the purpose of consumption and exportation which ultimately
will bring an increased favorable balance of payment (BOP) for the nation.
2. This work will
be advantageous to schools (staffs and students) and will help them understand
the importance of farming no matter how small the scale of production may be.
.3. The researcher
will personally benefit from the study as the study was undertaking as a
partial requirement for award of \bachelor of science \degree (B.Sc) in the
department of Economics in Ebonyi State University Abakaliki. From the study,
the operational mechanisms and technicalities of agricultural operations in Nigeria will be
made known.
This
research work focuses on the impact of agricultural development on the economic
growth of Nigeria
between the period of 1980 to 2013.
There
are some factors or constraints which hinder my achieving the whole intension
of this work, these constraints are; time factor, inadequate finance,
environmental constraints like free movement to research outside the school
premises among other.
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