Principally, there are three main determinants of economic growth, which are; the growth of its labour force, the growth of capital stock, and technical progress

Nigeria used to be heavily dependent on the agricultural sector prior to the oil boom In the early 1950's up to the early 1970's before the discovery of crude oil, agriculture was the mainstay of the economy, employing 70 per cent of the total population Although subsistence farming was predominant, it was a major revenue earner for the country In the early 1980's, it became more apparent that the agricultural sector could no longer perform its traditional role of meeting domestic food requirement, raw materials for industry and started to decline as a major foreign exchange earner through exports due to economic , social and political problems

Nigeria's soils and climate allow cultivation of a wide variety of food crops, including cassava (of which Nigeria is the largest world producer), millet, sorghum and maize Agriculture is Nigeria's biggest employer of labour, accounting for about 60 per cent of the workforce, working mainly in small-holdings using basic tools Together with livestock rising, it provides a third of gross domestic product

Growth in agricultural output averaged 35 per cent over 1993-1997, higher than the population growth rate, 40 per cent, 52 per cent, 29 per cent, 51 per cent from 1998-2000 respectively (CBN 2000) This compares with a period of stagnation in the first half of the 1980's when growth averaged just 05 per cent, due to low producer prices, marketing restrictions and a drought Agriculture picked up after the economic reforms introduced in 1986, which included trade liberalization, dissolution of price-fixing marketing boards and improved producer prices facilitated by devaluation of the naira Growth in the sector averaged 38 per cent in 1986-92, and there was a burst of activity in the cash crop sector, with many farmers returning to previously abandoned fields However, the renewed interest was not sustained, nor did it result in increased investment in cash crop production, mostly carried out by smallholders Improved food crop production contributed to a sharp fall in food imports, from 193 per cent of total imports in 1983 to 71 per cent in 1991, although this crept back up to 131 per cent in 1996 Much of the increase in agricultural output in recent years has resulted from expansion of the area under cultivation, rather from increased productivity The sector has been hampered by lack of investment in improved farming technology Over-farming of fragile soil has worsened

The share of agricultural products in total exports has plummeted from over 70 per cent in 1960 to less than 2 per cent today The decline was largely due to the phenomenal rise of oil shipments, but also reflected the fall in the output of products like cocoa, palm oil, rubber and groundnuts, of which Nigeria was once a leading world producer For example, production of cocoa, currently Nigeria's biggest non-oil export earner, has remained around 160,000 tonnes per year since 1995, compared with an annual average of 400,000 tonnes at its peak before the oil boom The government has made some effort to encourage private investment in agriculture and agro-industries by providing incentives, including tax breaks, finance credit and extension services, but without much success

12 Background of the study

This area of study is quite broad and as such various studies have been carried out in the area in general and other sub-sectors, highlighting the relevance of the sector towards economic growth With the understanding been identified, many researchers, scholars have developed models on improving and developing the agricultural sector especially in developing countries However the study will attempt to review available literatures within its reach

121 Socio-economic and development challenges in Nigeria's agriculture

Nigeria is one of the largest countries in Africa, with a total geographical area of 923 768 square kilometres and an estimated population of about 126 million (2006 estimate) It lies wholly within the tropics along the Gulf of Guinea on the western coast of Africa Nigeria has a highly diversified agro ecological condition, which makes possible the production of a wide range of agricultural products Hence, agriculture constitutes one of the most important sectors of the economy The sector is particularly important in terms of its employment generation and its contribution to gross domestic product (GDP) and export revenue earnings Despite Nigeria's rich agricultural resource endowment, however, the agricultural sector has been growing at a very low rate Less than 50% of the country's cultivable agricultural land is under cultivation Even then, smallholder and traditional farmers who use rudimentary production techniques, with resultant low yields, cultivate most of this land The smallholder farmers are constrained by many problems including those of poor access to modern inputs and credit, poor infrastructure, inadequate access to markets, land and environmental degradation, and inadequate research and extension services

Since the collapse of the oil boom of the 1970s, there has been a dramatic increase in the incidence and severity of poverty in Nigeria, arising in part from the dwindling performance of the agricultural sector where a greater majority of the poor are employed Furthermore, poverty in Nigeria has been assuming wider dimensions including household income poverty, food poverty/insecurity, poor access to public services and infrastructure, unsanitary environment, illiteracy and ignorance, insecurity of life and property, and poor governance In response to the dwindling performance of agriculture in the country, governments have, over the decades, initiated numerous policies and programs aimed at restoring the agricultural sector to its pride of place in the economy But, as will be evident from analyses in the study, no significant success has been achieved due to the several persistent constraints inhibiting the performance of the sector From the perspective of sustainable agricultural growth and development in Nigeria, the most fundamental constraint is the peasant nature of the production system, with its low productivity, poor response to technology adoption strategies, and poor returns on investment It is recognized that agricultural commercialization and investment are the key strategies for promoting accelerated modernization, sustainable growth and development and, hence, poverty reduction in the sector However, to attract investment into agriculture, it is imperative that those constraints inhibiting the performance of the sector are first identified with a view to unlocking them and creating a conducive investment climate in the sector

The development challenges of Nigeria's agriculture are, therefore, those of properly identifying and classifying the growth and development constraints of the sector, unlocking them, and then evolving appropriate strategies for promoting accelerated commercialization and investment in the sector such that, in the final analysis, agriculture will become one of the most important growth points in the economy

In spite of the existence of a well-articulated agricultural policy document for Nigeria since 1988, the country has never established a systematic focus in her agricultural planning history that shows a conscious effort to purposely prioritize her agricultural development based on the generally identified components that constitute modern agriculture Over the years, there has been the development and adoption of programs that tended to generally support only increased production of commodities in the country Such programs have included, among others :

a Farm settlement schemes (FSS) in the early to mid 1950s for creating farmsteads of the Israeli Moshav-type agriculture intended to increase commodity output and create employment for young school leavers

b River basin development authorities (RBDA's) for the purpose of harnessing water resources for farmers throughout the country

c Green revolution scheme (GRS) that encouraged all Nigerians in both urban and rural areas to go into agriculture for both commerce and provision of food for home consumption

d Agricultural development programs (ADP's) in all states of the federation to help organize farmers into more productive agriculture through the provision of modern inputs

Each of these programs/schemes succeeded in momentarily increasing food production only There were no inbuilt components that purposely catered for the processing and/or commercialization of the food output Thus, understandably, they failed as efforts aimed at developing the agriculture sector Recent attempts that have recognized agriculture's current level of performance and the fact that every aspect of Nigeria's agriculture sector needs attention have only listed specified areas that require attention For instance, the 2001 Rural Development Sector Strategy identifies the following areas for immediate attention if agriculture and rural development in Nigeria are to make the desired impact on the lives of the people:

a Institutional restructuring and role reassignment in the agricultural extension sub sector

b Agricultural technology development and natural resource management

c Physical and social infrastructural development

d Public intervention in specified areas of rural agriculture to measure effectiveness